What Makes Money Valuable?

What Makes Money Valuable?

 

We go for shopping, purchasing goods and what not? All the sort of stuff that we purchase from the market worth some money out of our pockets and obviously it is an equivalent to the price specified with that thing. You must have taken a currency in your hands, have not you? Here we have tried our best to make you aware of what money actually is by some facts and figures that we have collected regarding the same.

What Makes Money Valuable?

What Makes Money Valuable?

What Money is, In Real?

Well, I have got a hundred rupees note in my hands and here is a promise quote written on it that reads, “I promise to pay the bearer, a sum of one hundred rupees” and under it there is a signature of the governor or reserve bank of India. According to the analysis of this statement, the money thus becomes a written promise by the governor of the country’s bank to pay you the requisite some of rupees.

The Barter System:-

Earlier in the olden days, the barter system was used as a means of purchasing the things. Suppose you are a farmer with some grains that you have sown and there is a blacksmith from which you need to purchase the new equipment, you will need to exchange the grains in exchange for those equipment following the barter system as this system used to include the exchange of goods irrespective of their value and this is the only reason there felt a need to have an approach that may make one get an estimate of the value of his or her product so as to solve the conflict between both the people exchanging their goods.

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Money Is A Piece of Paper, The Cost It Bears Gives It The Importance:-

In barter system, the exchange was a means of purchasing and thus even the precious things could be purchased with less valuable goods which is why the paper based currencies were introduced and then coins came in fashion to solve this jeopardy as these used to be merely a form of metal or paper if there was not a promise made by the governor’s side that this paper can be used in exchange of the goods of equal value.

Traditional Comparison of Currencies:-

The coins earlier used to be made of metals that could be more precious than the value of coin and thus people started melting them in order to make jeweler and other such things. The paper based money was thus an alternative that solved multiple problems together in one go.

Conclusion of The Research:-

With whatever we have discussed till year, there is only one derived conclusion and it says that money is basically nothing if it is not bound with a promise by the government authorities and if bound with a promise, this can worth a value that you can bring into use to make the exchange for valuable products. The currencies of various countries fight at an international level so as to make their way on the top lists and this decides the economic condition of that economy.

 

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