By Nenos - 11.03.2020
Difference between standard money and token money
Barter System and Money. Distinguish between:Standar economics Standard coins are such coins whose face value is equal to its commodity value. Answer · (i) Standard or full-bodied money: Any money whose face value (exchange value) is equal to its intrinsic value (the worth of the metallic content of money).
What are the different types of money? Answer: The different types difference between standard money and token money money are: i.
Commodity money - Initially, human beings exchanged goods and services for other goods and services.Classification of Money -Engineering Economics
In other words, commodity difference between standard money and token money or commodity money was difference between standard money and token money prevalent. Money in the form of metals - After commodity money was phased out, metals began to be used as a medium of exchange.
Under the metallic monetary system, gold and silver were the two metals that were of particular important and were widely in use.
Money in the form of paper - With further rise in the volume of trade, paper money came into existence and was widely used. This form of money was easier to carry and store. Thus, it became a medium of exchange in almost all the countries of the world. Bank money and difference between standard money and token money money - Bank money can be said to be the most convenient and durable form of money.
Nowadays, individuals frequently use credit https://obzor-market.ru/and/easiest-way-to-buy-and-send-bitcoin-reddit.html in the difference between standard money and token money cheques, drafts, credit cards difference between standard money and token money.
Plastic money - Plastic money in the form of debit cards has also emerged as an attractive medium of exchange. Moreover, net banking facilities and online transactions have further reduced the risks involved in carrying paper money. Page No State with reasons whether you agree or disagree with the following statements.
Barter System did not have any difficulty. Answer: No. Barter system had many difficulties. The various drawbacks of the barter system are as follows: i. Problem of double coincidence of wants: Double coincidence difference between standard money and token money wants implies that the needs of two individuals should complement each other for the exchange to take place.
For example, suppose a person in the above case, the second person must need rice in exchange of tea.
Lack of a common unit of value: Under the barter system, there was no common difference between standard money and token money for measuring the value of one good in terms of the other good for the purpose of exchange.
For example, creditmantri refer and horse cannot be measured in terms of rice in case of exchange between difference between standard money and token money and horse.
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Difficulty in wealth storage: It was very difficult to store commodities for future exchange purposes. The perishable goods like grains, milk and meat could not be stored to exchange goods in future.
Therefore, wealth storage was a major difficulty in the barter system. https://obzor-market.ru/and/bellroy-wallet-hide-and-seek-review.html
Lack of standard of deferred payments: The future payments could not be met in a C-C economy barter systemas wealth could not be stored. It was very difficult to pay back loans. Anything can function as money. Anything cannot function as money. For a thing to be used as money it must possess the following qualities: i.
General acceptability: Good money is the difference between standard money and token money which is readily accepted by all without any reluctance.
This quality is possessed by see more and silver. Divisibility: Any commodity acts as good money if it can be divided into small units.
For example, difference between standard money and token money notes, gold, silver and coins possess the quality of divisibility as they can be divided into different denominations. Durability: It should possess the quality of durability. That is, it should be long lasting. As currency coins are made up of metal, these are more durable compared to currency notes.
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Cognizibility: By cognizibility, we mean that good money is the one which is easily recognisable by all the members of the society and so special efforts are not required to recognise it. Portability: It should be easy to carry from one place to other without any difficulty, expenses or inconvenience.
Homogeneity: Money of the same denomination should be homogenous in size and quality. For example, all Rs.
Stability of value: Anything which is used as money should be stable. In the sense, value of money should not change frequently.
Money performs various functions. Answer: Yes. Money performs a variety of functions. According to professor Kinley, we can classify the just click for source of money into the following three categories: 1.
Primary functions 3. Contingent functions i. Primary functions of money: There are two primary functions of money a. Medium of exchange - Difference between standard money and token money acts as a medium of exchange as it facilitates exchange through a common medium i.
Unit of value - Money serves as a common medium or unit of value. Money has provided a common yardstick to measure difference between standard money and token money units in a common denomination known as price. Secondary functions of money: These are those functions that money performs along with its primary functions.
The secondary functions of money can be divided into the following three parts: a. Store of value - Money performs the function of a store of value. It implies that money can be easily saved and used for future needs.
Standard of deferred payments - As money is widely accepted as a medium of exchange, and can be used to store value without much loss of value, it can be used for future payments.
Transfer of value - Money can be transferred easily from one place to another and from one person to another. Therefore, with the help of money, purchasing power can be transferred.Fiat Money, explained
Contingent https://obzor-market.ru/and/coin-master-spin-and-coin-generator.html of money: The following are the various contingent functions that money performs.
Facilitates credit- Money facilitates the functioning of credit instruments such as cheques, promissory notes, bills of this web page etc. Facilitates distribution of income - Factor payments can be made easily in the form of monetary remunerations such as wages, rent, interest and profit.
Liquidity - Money is the most liquid of all the assets and wealth.
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