2. The word money is being derived
from the Latin word ‘MONETO’.
Money can be defined as any
commodity that is generally
accepted as a medium of exchange
and a measure of value.

3. Functions of Money
• Primary Functions:
Medium Of Exchange: The fundamental
role of money is to serve as a medium of
exchange . A consumer can purchase any
commodity or service with help of
money.

4. Measure of Value : The value of
all goods and services is
expressed in terms of money . It
helps to compare value of all
commodities . Every country has
a standard money or a monetary
unit in terms of which values are
expressed and measured which
is known as currency such as
dollars, pounds, yen etc

5. Secondary Functions:
a) Standard Of Deferred
Payments : Future Payments are
termed as deferred payments.
Deferred payments are possible
only because of money . Money
makes possible the credit
transactions to happen . Money
acts as a standard of deferred
payments.

6. (b) Store of Value : Money
works as a store of value along
with satisfaction of present
wants , provisions for future
wants is equally important . It
serves as a store of value
because money has purchasing
power .

7. c) Transfer of Values : Today
with the extension of trade
among various countries and
organizations ,it becomes
necessary to transfer
purchasing power from one
place to another.

8. Kinds of Money
• Metallic Coins
• Paper Money