Money is a widely accepted medium of exchange, unit of account, and store of value used to facilitate transactions, reduce bartering costs, and measure wealth. It acts as a, often, non-tangible system of value, including currency (cash/coins), bank deposits, and electronic, or digital, money. Key types include fiat money (government-backed) and commodity money (intrinsic value).
Wikipedia +5
Wikipedia +5Key Aspects of Money:
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- Functions: Serves as a medium of exchange, unit of account, and store of value.
- Types:
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- Commodity Money:
Has intrinsic value (e.g., gold, silver).
- Commodity Money:
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- Fiat Money: Value is derived from government decree, not physical worth (e.g., paper currency).
- Representative Money: Represents a claim on a commodity (e.g., checks).
- Properties: Must be durable, portable, divisible, and stable.
- Evolution: Began with commodities, moved to metal coins, and evolved into paper
