How is money classified in economic terms?

Money is classified in economic terms as a commodity because it serves as a medium of exchange that has intrinsic value, allowing it to be traded for goods and services. Historically, commodities like gold or silver were used as money because they could be physically exchanged and held value. In modern economics, the essence of commodity money lies in its ability to fulfill the primary functions of money: being a unit of account, a medium of exchange, and a store of value.

While cash and credit are also terms associated with money, they do not represent the fundamental classification of money itself. Cash refers specifically to physical currency like coins and banknotes, and credit involves borrowing or deferred payment. Neither of these terms encapsulates the concept of commodity money, which is rooted in the original forms of money that had specific useful qualities beyond mere paper currency or credit arrangements.

In summary, classifying money as a commodity highlights its foundational role in facilitating trade and economic activity, while the other options are more specific instances or forms of money rather than classifications.