Response to the following questions:
1. Which standard of measure is the best for measuring financial transactions?
2. Countries have had problems with the stability of their money. Briefly describe the problem caused for financial statements when money does not hold a stable value.
3. In some countries where inflation has been material, an effort has been made to retain the significance of money as a measuring unit by adjusting the financial statements by an inflation factor. Can an accurate adjustment for inflation be made to the statements? Can a reasonable adjustment to the statements be made? Discuss.