Which of the following is NOT a characteristic money must have to be effective?

• A. Durability, portability, divisibility, scarcity
• B. Durability, portability, divisibility, uniformity
• C. Durability, portability, divisibility, acceptability
• D. Durability, portability, divisibility, stability

Answer: (D)

The main idea is that money must have features that make it practical as a medium of exchange: it lasts through use, is easy to carry, can be divided into smaller units for small purchases, and is widely recognized as having the same value in every unit. Durability ensures it can survive repeated handling, portability lets people move it around easily, and divisibility lets you pay exact amounts. Uniformity (or acceptability) means each unit is the same in value, so people trust it in transactions.

Stability of value, while highly desirable, isn’t a fundamental requirement for money to function as a medium of exchange. A currency can still be used to pay for goods and services even if its value fluctuates, though instability makes it a poorer store of value. That’s why stability is not a core necessary property, making the choice that includes stability the one that isn’t a required characteristic.