Saturday, February 12, 2011

Understanding money

the money is important actor. Money is an object which is generally accepted as a middleman to facilitate the exchange in economic life of society. study economics about money is important.
Based on these definitions, the money must meet the following requirements:


-liked and generally accepted
- Than the old and not easily damaged
- fixed value for a long time
- easily stored and easily moved
- easily divided without reducing the value
- have only one quality
- limited and not easily faked
Original function of money:
- as a general exchange alt
- as a unit of account
- as a store of value
derivative function of money
- as a means of payment
- as a means of building wealth and riches procrastinators

 The amount of money spent by government should not be too much, although be used to build the city, because it can cause inflation. Actually easy to build the facility within the State. Just print the money. But it was full of risk. The number of the money in circulation must equal the amount of gold reserves held in the State . First man to meet their own needs without help from others, but over time they realized that human needs much and much. Then they use barter to trade. After using barter in a long time felt there were many deficiencies in this type of transaction. Like, can not be brought anywhere, sometimes there are people who do not feel quite fair, there are no durable goods, so they are looking for items that can be used for trading without a weakness like that, finally discovered the money. so the economy is fluently used and economics can more modern.
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