write in your own words how many become a unit for measuring prices in a country and also becomes a medium of exchange on which all future payments are based
Answers
Medium of exchange
In economics, a medium of exchange is any item that is widely acceptable in exchange for
goods and services.
[1]
In modern economies, the most commonly used medium of exchange is
currency.
The origin of "mediums of exchange" in human societies is assumed to have arisen in antiquity as
awareness grew of the limitations of barter. The form of the "medium of exchange" follows that
of a token, which has been further refined as money. A "medium of exchange" is considered one
of the functions of money.
[2][3][4] The exchange acts as an intermediary instrument as the use
can be to acquire any good or service and avoids the limitations of barter; where what one wants
has to be matched with what the other has to offer.
[5][6]
Most forms of money are categorised as mediums of exchange including commodity money,
representative money, cryptocurrency and most commonly fiat money. Representative and fiat
money most widely exist in digital form as well as physical tokens, for example coins and notes.
In a barter transaction, one valuable good is exchanged for another of approximately equivalent
value. William Stanley Jevons described how a widely accepted medium allows each barter
exchange to be split into three difficulties of barter.
[7] A medium of exchange is deemed to
eliminate the need for a coincidence of wants.
Want of coincidence
Overcoming the limitations of barter
Answer:
In economics, a medium of exchange is any item that is widely acceptable in exchange for goods and services.[1] In modern economies, the most commonly used medium of exchange is currency.
The origin of "mediums of exchange" in human societies is assumed to have arisen in antiquity as awareness grew of the limitations of barter. The form of the "medium of exchange" follows that of a token, which has been further refined as money. A "medium of exchange" is considered one of the functions of money.[2][3][4] The exchange acts as an intermediary instrument as the use can be to acquire any good or service and avoids the limitations of barter; where what one wants has to be matched with what the other has to offer.[5][6]
Most forms of money are categorised as mediums of exchange including commodity money, representative money, cryptocurrency and most commonly fiat money. Representative and fiat money most widely exist in digital form as well as physical tokens, for example coins and notes.
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