The correct answer is option 3: 1, 2, and 3.

1. Act as an intermediate in the exchange process: This means that money must be able to facilitate the trading of goods and services. It acts as a medium of exchange, allowing people to buy and sell things.

2. Standard unit for noting prices: Money needs to serve as a common unit of measurement for determining the value of goods and services. By setting prices in a standard monetary unit, it becomes easier for people to compare and evaluate different products.

3. Must be easily divisible: Money should be easily divided into smaller units to support transactions of different values. This allows for flexibility in making purchases and ensures that people can easily exchange smaller portions of money without any difficulty.

4. Have higher value in alternative uses: This statement is incorrect as it is not a necessary characteristic for something to be recognized as money. Money does not necessarily need to have a higher value in alternative uses. Its primary function is to facilitate economic transactions and serve as a medium of exchange.

Therefore, the correct characteristics for something to be recognized as money are 1, 2, and 3.