Role of finance in an economy?

Answer 1

The role of money in an economy is very critical as money serves as the backbone of the economy. The economy is actually measured using the monetary value of a nation's currency and money is the main medium of exchange in all type of trade.

Answer 2

Finance is critical to the economy in that money is needed for business to function in society. For example, a person deposits money into a financial institution, which then lends money out to a small business. That small business sells a product that is needed by the person, so they buy it and the business pays back the loan given from the financial institution.

Answer 3

One role of money in our society and economy is that it gives consumers a way to purchase goods and services. Without money, consumers would have to rely on the barter system.