What is Money? Meaning
Money is i of the greatest inventions of mankind. According to Walker,
"Money is what Money does."
Image Credits © Mark Morgan.
In a wider sense, Money includes all mediums of exchanges similar Gold, Silver, Copper, Paper, Cheques, in addition to Bills of exchange, etc.
Definition of Money
According to Crowther,
"Anything that is mostly acceptable equally a agency of telephone commutation in addition to which at the same fourth dimension acts equally a stair out in addition to shop of value."
Thus, Anything is Money, which is mostly acceptable equally a medium of exchange, in addition to at the same fourth dimension it must human activity equally a stair out in addition to a shop of value. Anything implies a affair to hold out used equally coin withdraw non hold out necessarily composed of whatever precious metal. The alone necessary status is that, it should hold out universally accepted yesteryear people equally a medium of exchange.
Functions of Money
Money performs 5 of import functions :-
- Medium of exchange : Money acts equally a medium of telephone commutation equally it's mostly accepted. On the payment of money, purchase of goods in addition to services tin dismiss hold out made i.e. goods in addition to services are exchanged for money. Money bifurcates buying in addition to selling activities separately in addition to thence it facilitates the telephone commutation transactions.
- Measure of value : Money is a mutual stair out of value in addition to thence it is possible to hit upward one's heed the charge per unit of measurement of telephone commutation betwixt diverse goods in addition to services purchased yesteryear the people. Exchange value of commodity tin dismiss hold out expressed inwards damage of money. For e.g. nosotros tin dismiss say that 10 metres of Cotton Cloth toll $220 dollars or Rs.10,000 rupees only.
- Store of value : Money acts equally a shop of value. Money existence mostly acceptable in addition to its value existence to a greater extent than or less stable, it is ideal for exercise equally a shop of value. Being non-perishable in addition to likewise comparatively stable inwards value, the value of other assets tin dismiss hold out stored inwards the shape of money. Property tin dismiss hold out sold in addition to its value tin dismiss hold out held inwards coin in addition to converted into other assets equally in addition to when necessary.
- Standard or Deferred payment : Money is likewise inevitably used equally the unit of measurement inwards damage of which all time to come or deferred payments are stated. Future transactions tin dismiss hold out carried on inwards damage of money. The loans, which are taken at present, tin dismiss hold out repaid inwards coin inwards the future. The value of the time to come payments is regulated yesteryear money.
- Transfer of value : Value of whatever property tin dismiss hold out transferred from i someone to unopen to other or to whatever establishment or to whatever house yesteryear transferring money. The transfer of coin tin dismiss bring house irrespective of places, fourth dimension in addition to circumstances. Transfer of purchasing power, which is necessary inwards commerce in addition to other transactions, has move available because of money.
