1. Nature and Function of
Money

2. Content $ 10 $ 10 $ 10 $ 10 10 $ 10 1.Barter System
2. Functions of Money
$ 10 10
3. Properties of Money
$ 10
4. Types of Money

3. Content 1.Barter System 2. Functions of Money 3. Properties of Money
4. Types of Money

4. Barter System
In ancient times before money was invented, people exchanged goods directly for other goods. This way of carrying out exchange is called barter.

5. Inconveniences of Barter
Difficulty in meeting double coincidence of wants

6. Inconveniences of Barter
Higher cost of agreeing on an exchange ratio.

7. Inconveniences of Barter
Lack of common measure of value
Inconvenience of storing wealth

8. When Money Is Used...
A person can sell his goods for money and then keep the money for future use.
The act of selling is separated from the act of buying

9. Content 1.Barter System 2. Functions of Money 3. Properties of Money
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2. Functions of Money
3. Properties of Money
4. Types of Money

10. Functions of Money As a generally acceptable medium of exchange
As a store of value
As a standard of deferred payment
As a unit of account

11. So, what is MONEY ?
MONEY
Money can be any asset that is generally acceptable as a medium of exchange for settling payments or debts.

12. Content 1.Barter System 2. Functions of Money 3. Properties of Money
4. Types of Money

13. Properties of Money Generally acceptable Limited in supply Durable
Portable
Divisible
Homogeneous

14. Content 1.Barter System 2. Functions of Money 3. Properties of Money
$ 5
4. Types of Money

15. Types of Money C C Commodity money has intrinsic value
e.g. cattle,silk, gold and silver
Convertible paper money
e.g. gold and silver certificates

16. Types of Money Inconvertible paper money also called ‘Fiat Money’
simply declared by the government as money
legal tender
e.g. notes and coins

17. Types of Money Deposit money Demand deposit current account
banks do not give any interest
not legal tender
e.g. cheque

18. Types of Money Saving deposit interest is paid
hold passbook to withdraw funds
not allow to withdraw more than balance in one’s account
e.g. EPS

19. Types of Money Time (or fixed) deposits
place one’s money with the bank for a period of time  Maturity period
interest rates are higher than those on savings deposits
Negotiable Certificates of Deposits (NCDs)
floating interest rates
transferable

20. Types of Money Electronic money card storing some amount of cash
deducted when buy goods and services

21. THE END