(i) Employment of Factor Inputs: Every producer aims at maximisation of his profits while employing various factors of production. A profit-maximising entrepreneur will equate marginal productivity (expressed in value terms) of a factor with its price (rate of remuneration). Since the rates of remuneration such as wage rate are expressed in money terms, it is money which helps the producer to arrive at decisions with regard to the units of a factor of production to be employed.
Basis of Credit System: Credit plays a crucial role in the modem credit system. In fact, commercial and business activities are highly dependent upon the credit system of a country. It is money which provides the basis of the entire credit system. Without the existence of money, important credit instruments like cheques, bills of exchange, etc. cannot be used.
