Correct Option: B Explanation of Why Option B is Correct: The function of money as a standard of deferred payments refers to its role in allowing transactions to occur where payment is made at a later date rather than immediately. This is particularly important in credit transactions, loans, and contracts where the payment is agreed upon to be made in the future.

1. Understanding Deferred Payments: When we say "deferred payments," we mean that the payment for goods or services is not made at the time of the transaction but is postponed to a later date. Money serves as a common measure that both parties agree upon for the future payment. For example, if you take out a loan, you receive money now but agree to pay it back later, often with interest.
2. Legal and Economic Framework: Money provides a legal framework for these transactions. Contracts often specify the amount to be paid and the date of payment, and money acts as the unit of account that quantifies this obligation. This function is crucial in economies where credit is a significant part of financial transactions.
3. Risk Management: By using money as a standard of deferred payments, individuals and businesses can manage risks associated with future payments. They can plan their finances knowing that they have a specific amount to pay at a future date, which helps in budgeting and financial planning.

Why the Other Options Are Wrong or Weaker:

• Option A: "Make possible for an individual to build up store of many things for future use"
• This option refers more to the function of money as a store of value rather than a standard of deferred payments. While money can indeed be saved and stored for future use, this does not directly relate to the concept of deferring payments. The focus here is on the ability to save rather than the ability to postpone payment obligations.
• Option C: "Facilitate the exchange of goods"
• This option describes the function of money as a medium of exchange. While facilitating exchanges is a critical function of money, it does not specifically address the concept of deferred payments. The ability to exchange goods immediately does not imply that payments can be postponed.
• Option D: "Makes easy calculations possible"
• This option refers to the function of money as a unit of account. While it is true that money allows for easy calculations of value, this does not directly relate to the concept of deferring payments. The ease of calculation is important for pricing and accounting but does not encompass the idea of postponing payment.

Summary of Key Points:

• Standard of Deferred Payments: Money allows for payments to be made at a future date, facilitating credit transactions.
• Legal Framework: Money provides a common measure for future obligations, essential for contracts and loans.
• Risk Management: It helps individuals and businesses plan their finances by knowing future payment amounts.
• Distinction from Other Functions: It is important to differentiate this function from money's roles as a store of value, medium of exchange, and unit of account.

By understanding these concepts, students can better grasp the multifaceted roles that money plays in an economy, particularly in relation to deferred payments.