Economics: Money and Credit · Class 10 · CBSE Social Science
Why is money accepted as a medium of exchange?
Practice question from Economics: Money and Credit (Class 10 · CBSE Social Science), with the correct answer and a step-by-step solution.
easy · MCQ · Q-516259
Why is money accepted as a medium of exchange?
- A.It has intrinsic metal value.
- B.It is authorized by the government of the country.Correct answer
- C.It can be easily converted into gold.
- D.It is issued by commercial banks.
Solution
In India, the Reserve Bank of India issues currency notes on behalf of the central government. Therefore, currency is accepted as a medium of exchange because it is authorized by the government of the country.
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