The Early man was a wanderer and a gatherer.
In the olden days, man survived by production.
Man efforts towards providing for himself to survive is called PRODUCTIVE EFFORT
Production is as old as man but money is not as old as man.
Man engaged in subsistence production which led to Specialization.
Specialization brought about Exchange.
The first form of Exchange is BARTER SYSTEM OF EXCHANGE
Problems created by specialization was solved by Exchange.
Problems of Barter System of Exchange include:
the need of double coincidence of wants,exchange rate determination,the indivisibility of some commodities,problem of storability, problem of standard of deferred payment.
The first kind of money had dual identity ( commodity money)
Sir John Money invented money in 3016BC
Money is anything which by law or custom is generally acceptable by people within a defined geographical area in exchange for goods and services and in settlement of debts.
The functions of money are Primary function & the Derivative function
The two forms of money is CURRENCY/CASH and DEMAND DEPOSIT LIABILITIES/CURRENT ACCOUNT BALANCES.
Bank notes were originated from Goldsmith while coins were originated from monarchs.
Currency is made up of Paper Money( Bank notes) & Metallic money (coins)
When money is backed by law is called Legal Tender/ Fiat money
When money is backed by custom is called Customary money.
Full Bodied Money isWhen intrinsic value(commodity value) is equal to nominal value( monetary value)
Debased money or Token money is when face value is greater than intrinsic value.
Paper money backed up by commodity money in circulation is called Representative Full Bodied Money.
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Question; what type of money is crypto currencies
