Correct Response: C. An advantage of using money to store value rather than investing in other assets such as real estate or fine art is that it is easier to convert money into goods and services with no risk or penalty. Money is the most liquid asset and is readily converted to cash. Although money can be exchanged for an equivalent value of gold or silver, changes in the market values of those commodities provides risk (A). The purchasing power of money value depends on inflation, exchange rates, and government policy (B). Interest paid on invested money is generally less than the gains in value of other assets, such as real estate, stocks, and bonds (D).
