Which activity represents the medium of exchange function of money?

Question

Sam saved $30 per week from his part-time job to buy a new DVD player. He went to three different electronics stores, comparing the prices on various models. He narrowed his choices to a Panasonic model costing $129.99 and a Sony model with a price tag of $139.99. After much consideration, Sam paid the salesperson $139.99 plus tax in $5 bills for the Sony DVD player. He brought his DVD player to his dorm room and he and his roommates watched their favourite movie every day for the rest of the term.

A. Sam gave the salesperson $139.99 in return for the DVD play

B. Sam saved $30 per week from his part-time job.

C. Sam found that the Panasonic model cost less than the Sony model.

D. Sam exchanged a B+ in his economics class for the pleasure of watching his favourite movie on his DVD player every day.

Answer 1

A.  Money exists so that we can efficiently exchange the products of our labors for the products of someone else's labor.  It is the medium of exchange that allows us to avoid the overhead of multiple transactions between and among multiple producers to match individual desires with the products available for sale

Answer 2

"A" is right one. He first stored value in money and then at certain moment of time converted (exchanged) money for goods.

Answer 3

A, because he exchanged his money to get a DVD, and money thus fulfils the medium of exchange function.