Water is called as a Universal solvent because it has excellent ability to dissolve many substances in it.
Water is also the reagent or the product of many biochemical reactions, such as photosynthesis, cellular respiration, the forming of peptide bonds for protein synthesis, etc.
The hydrogen atoms from water are incorporated into the produced glucose and the oxygen atoms from water make up the molecular oxygen liberated: carbon dioxide + water + light = glucose + molecular oxygen. Aerobic respiration is an example of a biochemical reaction in which water is produced: glucose + molecular oxygen = carbon dioxide + water.
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