Question

What is money? explain the evolution and functions of money?

Answer 1

Money is a concept which we all understand but which is difficult to define in exact terms.

Money is anything serving as a medium of exchange. Most definitions of money take ‘functions of money’ as their starting point. ‘Money is that which money does.’ According to Prof. Walker, ‘Money is as money does.’



This means that the term money should be used to include anything which performs the functions of money, viz., medium of exchange, measure of value, unit of account, etc. Since general acceptability is the fundamental characteristic of money, therefore, money may be defined as ‘anything which is generally acceptable by the people in exchange of goods and services or in repayment of debts.’

Answer 2

Studies have shown that metal objects in the different forms and shapes were introduced as many many thousand years ago metal coins probably around 500 BC to 700 BC metal coins were introduced as many countries was some maintaining their own series of coins with in a scientific values metal was used because it was ready to work with and could be recycled. Since coins verb given certain values it become easier to compare the cost of item people wanted dates back to China issue of paper money became common from about 806 onwards . Paper money are notes with standardized characteristics China experience over 500 years of early paper money spamming over 9 to 15 century then beginning in 14558 the use of paper money in China disappeared for several hundred years this was still many years of before paper currency could reappear in Europe and three centuries before it was considered common