History of Money Flashcards
Bartering
An exchange that happens without money (goods and services for goods and services).
Goods
Items that are used for exchange and are physical or tangible.
Service
An action someone does for someone else.
Subsistence economy
An economy that makes all their needs by themselves. They have a greater range of specialised items.
Specialisation
Making a product according to strengths, something they’re good good at.
Surplus
More than what is required.
Markets
A place for people to buy and sell products.
Problems with bartering
- comparable (like and accept)
- time-consuming
- quality of products
Benefits of money
- efficient
- comparable (exchange rate)
- both benefit
- easier to trade with
Problems with money
- old fashioned
- uncomparable
- who benefits?
Development of money
- Objects
- Promissory notes
- Coins
- Paper money
- Electronic banking
Electronic banking
Buying goods online without any physical currency (notes and coins) exchanged.
Benefits of electronic banking
- easy to manage money and business
- record keeping is easier
- safer
Medium of exchange
The item used in the exchange or type of currency (e.g dollar or rand)
Characteristics of money
- cannot be copied easily
- durable
- portable
- easily divided into smaller units
