Store of Value
Definition
A store of value is an attribute of money that enables it to hold its purchasing power over time.
Analogy
Imagine a piggy bank. Just like you can save your coins in a piggy bank to use them later, money serves as a store of value by allowing you to save it today and spend it in the future when needed.
Related terms
Inflation: It refers to the general increase in prices over time, which erodes the purchasing power and value stored in money.
Financial Assets: These are instruments such as stocks, bonds, or savings accounts that can also serve as stores of value.
Depreciation: It represents the decrease in value or purchasing power over time due to factors like wear and tear or obsolescence.
"Store of Value" appears in:
Additional resources (1)
Resources
© 2024 Fiveable Inc. All rights reserved.
AP® and SAT® are trademarks registered by the College Board, which is not affiliated with, and does not endorse this website.