Question

Which of the following means of exchange has universal acceptance?

• A. Bond
• B. Gold
• C. Land Asset
• D. Legal tender

Hint:

Legal tender is any form of payment that the law requires to be accepted for settling debts. It is the official currency in a country.

Answer 1

The Correct Option is D

Step 1: Understanding universal acceptance.
Legal tender refers to the official currency that must be accepted for the payment of debts within a country. It has universal acceptance within the jurisdiction in which it is issued, meaning that it is the standard method of payment.

Step 2: Analyzing the options.
(A) Bond: A bond is a debt security, but it is not universally accepted as a form of exchange.
(B) Gold: Gold is valuable, but it is not a universally accepted form of payment in today's economies.
(C) Land Asset: Land is an asset, but it is not commonly used for daily transactions as a medium of exchange.
(D) Legal tender: Correct. Legal tender is currency issued by a government that must be accepted for the payment of debts, making it universally accepted within the issuing country.

Step 3: Conclusion.
The correct answer is (D) Legal tender, as it is the only form of exchange universally accepted for all transactions in the country.