Which of the following is NOT a function of money?

Money serves several critical functions within an economy, and understanding these functions helps clarify why financial investment is not one of them. The primary functions of money include:

• Medium of exchange: Money facilitates transactions by eliminating the inefficiencies of barter systems. It allows goods and services to be exchanged in a straightforward manner.

• Store of value: Money can preserve value over time, meaning individuals can save and defer consumption until a future date without losing value. This is essential for planning and saving.

• Unit of account: Money provides a standard measurement of value, which simplifies the process of pricing goods and services, allowing for easy comparison and accounting.

Financial investment, while it can involve the use of money, is not a function of money itself. Instead, financial investments are activities that involve allocating resources (usually money) in hopes of generating a return or profit. This distinction is critical because the purpose of financial investments relates to generating income or capital gains rather than fulfilling one of the fundamental functions of money.