Money Measures Value Comparably

Steps:

• Note prices: cakes at $10 each, tutoring at$20 per hour.
• Observe equivalence: one tutoring hour equals two cakes ($20 = 2 ×$10).
• Recognize money assigns numerical values to dissimilar goods/services for comparison.
• Identify function: this common measure is money's unit of account role.

Why D is correct:

• Unit of account defines money as a standard for valuing and comparing diverse items, enabling the $20 tutoring to equal two$10 cakes.

Why the others are wrong:

• A: Medium of exchange facilitates transactions, but no buying/selling occurs here.
• B: Standard of deferred payment settles future debts, unrelated to present valuation.
• C: Store of value preserves wealth over time, not shown in this pricing comparison.

Final answer: D