Economy, asked by pjvishnu101, 3 months ago

the following question is a long answer question pls help and who gives best I will mark brainiest

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Answered by kusumliza62
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1. Introduction

In our world today, money is high-tech. People not only use coins and dollar bills

issued by the government as money, but also increasingly cheques and credit cards.

Banks are able to move millions of dollars by touching only one button on their

computers.

Money has always been important to people and to the economy. Many economists,

like Keynes (Skidelsky, 2000, pp.110,112), have dealt with the question of money

already. The forms money has taken on over centuries have always been closely

connected with the technological developments in the economy. As simple

economies evolved into more complicated economies, money has always adapted to

the different economic circumstances. With respect to the latest innovations in the

computer industry a new form of money has evolved: e-money.

This paper describes the transition from traditional government money to privately

issued electronic money. It examines the current innovations in the payment

technologies by exploring how today’s forms of money have evolved over time. It

also reflects the reasons for inventing electronic money schemes.

2. The Meaning of “Money“

To understand how modern money developed, one has to comprehend exactly what

money is and what its functions are.

3. Functions of money

No matter whether money is gold or paper or beads or knives, in any economy it has

three functions. It is a medium of exchange, a unit of account and a store of value.

(Mankiw, 1999, pp.155-156) These three different functions can be distinguished in

the following ways:

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