Deploring child sacrifice and the strength of the covenant
The story of Abraham preparing to sacrifice Isaac serves two main purposes, not the least of which would have been to provide the people of Israel with a satisfactory cultural explanation as to why they do not condone the sacrifice of children apparently performed by the native tribes around them. The use of dramatic tension presents the emotional side of child sacrifice from the point of view of Abraham, whose only son was not only long awaited and miraculous, but also promised - the presumed lynchpin of his covenant with God and assurance of both his numerous descendants and future status as a 'father of many nations'. But the story also serves to demonstrate the strength of Abraham's covenant with God, outlasting any human standards of trust.
In the story, for reasons that are not mentioned, Abraham determines that God is asking him to offer his beloved son as sacrifice. That no reason needed to be given suggests that this was not an unusual request assumed from deities in Abraham's time (although in Moses' time, when Genesis was supposedly written, child sacrifice was considered common practice only among the enemies of Israel, and is expressly forbidden under Hebrew law).
Abraham has already entered into a covenant with God at this stage, a common practice in those times between individuals, tribes or families that confirms trust by both parties in the integrity of their communication channels. Abraham's end of the bargain is to trust that anything he is instructed to perform will not compromise what he has been promised, even though it appears as if he is being told to destroy the only chance he sees of achieving it.
The trust demonstrated by Abraham is essential for a covenant like this to work. It is not a blind trust (as shown by Abraham's intervention in the story of Sodom), but one built on a history of honest and respectful communication. In a tribal situation, for instance, the communication channel would often begin as a single marriage between individuals from both tribes - if you cannot completely trust the accepted communication channels, then there is no covenant. Because if it looks like your neighbour is preparing for war, you want to be able to trust that their intentions are not against you. The audience would be well aware of many instances where covenants have failed due to miscommunication, fear and lack of trust, with often tragic results.
By Abraham's actions in the story, and his statement to Isaac that "God himself will provide a lamb for the offering", he demonstrates complete trust in the communication he has with God, even when it seems as if he is going to have to go through with the sacrifice which, from Abraham's point of view, would have destroyed the covenant. No covenant between families or tribes could be expected to survive this level of trust.
Despite the dramatic tension, it is also clear from Abraham's words to his son, mentioning the lamb, that the intended audience already knows the ending. The ramifications of this story, like Just So stories or World War II films, are expected because they are inherent in the audiences' cultural framework and worldview. The appearance of a ram at the opportune time provides the accepted substitute to child sacrifice now decreed in Hebrew law, and the covenant remains intact.
The situation in which Abraham is compelled to sacrifice his son - and the dramatic tension that takes the characters right to the limit before making the expected substitution - are actions taken not so much by God, but by the author. They serve to illustrate the deplorability of child sacrifice and the strength of Abraham's covenant with God over any other.