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financial capital

In economics, money is defined as serving four functions:
  • medium of exchange? - how trade happens, e.g. in labour
  • unit of account? - how debit? and credit? are defined
  • store of value? - how savings? and investment? occur
  • standard of deferred payment? - how debt is quantified

A financial capital instrument serves any or all of these functions. Some forms of financial capital, such as gold coins, may be useful for most of the above purposes, but they aren't convenient or conventional for all of them. A municipal bond?, while a good store of value but must be denominated in terms of some other unit, medium, and standard (typically the national currency). Instruments vary widely.




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