Money is a fundamental discovery that has eased day-to-day transactions, made it possible to value goods and services, and allowed us to store wealth and trade in future. Modern forms of money are linked to the banking system. Robertson defined it: "Money is anything which is widely accepted in payment for goods or in discharge of other business obligations."
1. Origin of the Words and the Barter System
- The word Money is derived from the Roman word "Moneta Juno", a Roman goddess and the republic money of the Roman empire.
- The Indian rupee is derived from the Sanskrit word 'Rupya', meaning silver coin.
- The earliest and primitive stage of money is the Barter system – exchanging goods for goods without the use of money.
Deficiencies of the Barter System
- Lack of double coincidence of wants
- Lack of a common measure of value
- Indivisibility of commodities
- Difficulties of storing wealth