* PRIMARY FUNCTIONS
Primary functions are the major function of the money which can be explained the following headings.
1. MEDIUM OF EXCHANGE
The primary and unique function of the money is to serves as the medium of exchange. It provides the economic freedom to the people. With the money people can sell or bye the product in the market. It also insures the purchasing power of the consumers.
2. MEASURE OF THE VALUE
Money serves as a common measure of value and standard unit of account. After the invention of the money, value of goods and services can be expressed in terms of currency of money. It has made the transaction easy and simplified the problem of measuring and compeering the price of the goods and services in the market. It also helps to calculate the macroeconomic indicators like NI, per capita income, GDP, GNP and Human Development indicators.
* SECONDARY FUNCTIONS
Secondary functions of money is less important then that of primary functions. This function are originated and derived from primary functions of money. Following are the secondary functions of the money.
1. STORE OF VALUE
Money serves as store of value of any goods and services in both short run and long run. In modern world people want to have some currency or coins in their pocket, home ,bank account etc to use anytime for the purchase of anything. The value of goods and services can be store in terms of money for many y due to quality of stability and durability. Money as the liquid store of value facilitates its owners to purchase any other assets in any times.
2. STANDERD OF DIFFERENT PAYEMENT
Lending and borrowing was the very difficult before the invention of the money, so that it was difficult to settle of lone. But due to different payment credit system become easy. With the help of money people can buy or sell goods and services only on commitment and payment can be made in the future in the form of installment. Money is regarded as the best transaction due to its quality of stability, accepting and durability. The future payment also possible through the help of money.
3. TRANSFER OF VALUE
Money also serves as the common tool to transfer the value of assets and income. Sale, purchase, mobilization and transfer if movable and immoveable property can also made with the help of the money. One can sell at one place and can buy them elsewhere. Value shift from one place to another because it transferred in terms of money.
Primary functions are the major function of the money which can be explained the following headings.
1. MEDIUM OF EXCHANGE
The primary and unique function of the money is to serves as the medium of exchange. It provides the economic freedom to the people. With the money people can sell or bye the product in the market. It also insures the purchasing power of the consumers.
2. MEASURE OF THE VALUE
Money serves as a common measure of value and standard unit of account. After the invention of the money, value of goods and services can be expressed in terms of currency of money. It has made the transaction easy and simplified the problem of measuring and compeering the price of the goods and services in the market. It also helps to calculate the macroeconomic indicators like NI, per capita income, GDP, GNP and Human Development indicators.
* SECONDARY FUNCTIONS
Secondary functions of money is less important then that of primary functions. This function are originated and derived from primary functions of money. Following are the secondary functions of the money.
1. STORE OF VALUE
Money serves as store of value of any goods and services in both short run and long run. In modern world people want to have some currency or coins in their pocket, home ,bank account etc to use anytime for the purchase of anything. The value of goods and services can be store in terms of money for many y due to quality of stability and durability. Money as the liquid store of value facilitates its owners to purchase any other assets in any times.
2. STANDERD OF DIFFERENT PAYEMENT
Lending and borrowing was the very difficult before the invention of the money, so that it was difficult to settle of lone. But due to different payment credit system become easy. With the help of money people can buy or sell goods and services only on commitment and payment can be made in the future in the form of installment. Money is regarded as the best transaction due to its quality of stability, accepting and durability. The future payment also possible through the help of money.
3. TRANSFER OF VALUE
Money also serves as the common tool to transfer the value of assets and income. Sale, purchase, mobilization and transfer if movable and immoveable property can also made with the help of the money. One can sell at one place and can buy them elsewhere. Value shift from one place to another because it transferred in terms of money.
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