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Question

Dare

OT

Identify the function of money in the following scenarios.

larin earns $10 raking leaves. She saves the money to buy the latest mystery novel in her favorite series

Answer

The function of money in this scenario is as a medium of exchange to purchase the mystery novel.

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In this scenario, money serves as a medium of exchange because it allows Larin to trade her labor (raking leaves) for a certain amount of money. She can then use that money to purchase the latest mystery novel in her favorite series. Without money, Larin would have to find someone who was willing to trade the novel for her labor, which may not always be possible or practical. Money makes it easier for people to exchange goods and services because it is widely accepted and can be used to purchase a variety of different items.