Why currency is accepted as a medium of exchange?
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Money eliminates coincidence of wants.
A person holding money can exchange it for any goods or services that the or she might need
Since money acts as an intermediate in the exchange process,it is called the medium of exchange
A person holding money can exchange it for any goods or services that the or she might need
Since money acts as an intermediate in the exchange process,it is called the medium of exchange
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Modern currency is accepted as a medium of exchange because it is authorized by the central government of a country. 2. In India, RBI issues the currency notes and it is illegal for any other organization or individual to issue the currency.
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