What is Money?

Money is any object or item generally accepted as a mode for payment of goods & services and repayment of loans or debts, such as taxes, etc., in a particular nation or country. It acts as a store of value, allowing individuals to save wealth and transfer purchasing power over time. It can take various forms, including physical currency such as coins and banknotes, and digital forms, like bank deposits electronic payments, cryptocurrencies, credit cards, and debit cards,.

Features of Money:

1. Medium of Exchange: Money serves as a commonly accepted medium for buying and selling goods and services. It eliminates the need for barter, where goods are exchanged directly for other goods, by providing a widely accepted means of payment.
2. Unit of Account: Money provides a standard measure of value that allows individuals to compare the worth of different goods and services. Prices are expressed in monetary terms, making it easier to assess relative values and make informed decisions about purchases and investments.
3. Store of Value: Money enables individuals to store wealth in a convenient and portable form. Unlike perishable or highly specific goods, money holds its value over time and can be easily exchanged for goods and services in the future. However, inflation and other factors may erode the purchasing power of money over time.

Money and Currency are often used synonymously, but they are different. Money is a medium of exchange with various functions and forms; whereas, Currency refers to the physical or tangible form of money issued by a government or central authority for use as legal tender within a particular jurisdiction.