PPT: From Barter to Money | PPTs for Class 7 PDF Download

 Page 1


From Barter to Money
Page 2


From Barter to Money
Introduction
Barter System
Before the invention of 
money, people used the 
barter system to 
exchange goods and 
services. For example, 
crops or beads were 
traded for other items.
Earliest Trade Items
Cowrie shells
Salt
Cloth
Cattle
System Limitations
However, this system was inefficient.
Page 3


From Barter to Money
Introduction
Barter System
Before the invention of 
money, people used the 
barter system to 
exchange goods and 
services. For example, 
crops or beads were 
traded for other items.
Earliest Trade Items
Cowrie shells
Salt
Cloth
Cattle
System Limitations
However, this system was inefficient.
Barter System
Evolution of Money
Money evolved as a common tool that 
everyone accepts for buying or selling goods 
and services, making trade much easier.
Today, we use coins, notes, and digital 
methods (like mobile payments) to conduct 
transactions.
John Maynard Keynes, a renowned 
economist, stated that money connects the 
present to the future by helping us save and 
spend later.
Page 4


From Barter to Money
Introduction
Barter System
Before the invention of 
money, people used the 
barter system to 
exchange goods and 
services. For example, 
crops or beads were 
traded for other items.
Earliest Trade Items
Cowrie shells
Salt
Cloth
Cattle
System Limitations
However, this system was inefficient.
Barter System
Evolution of Money
Money evolved as a common tool that 
everyone accepts for buying or selling goods 
and services, making trade much easier.
Today, we use coins, notes, and digital 
methods (like mobile payments) to conduct 
transactions.
John Maynard Keynes, a renowned 
economist, stated that money connects the 
present to the future by helping us save and 
spend later.
Why Do We Need Money?
Double coincidence of wants
The farmer must find someone 
who wants an ox and offers 
exactly what he needs (shoes, 
sweater, medicines). This is 
rare.
Common standard measure 
of value
It's hard to decide how much 
an ox is worth compared to 
shoes or medicines, as there's 
no agreed value.
Divisibility
An ox cannot be split into parts 
for smaller trades, like for a 
sweater.
Portability
Carrying an ox or bags of wheat (traded for the ox) 
to different places is difficult.
Durability
Wheat rots or gets eaten by rats, so it cannot be 
stored for long.
The barter system had many problems, making money necessary. For Example: A farmer with an ox needs shoes, a 
sweater, and medicines but faces these challenges.
These problems made trading slow and complex, so a better system was needed. Money solves these issues by being a 
common, portable, divisible, and durable way to trade.
Page 5


From Barter to Money
Introduction
Barter System
Before the invention of 
money, people used the 
barter system to 
exchange goods and 
services. For example, 
crops or beads were 
traded for other items.
Earliest Trade Items
Cowrie shells
Salt
Cloth
Cattle
System Limitations
However, this system was inefficient.
Barter System
Evolution of Money
Money evolved as a common tool that 
everyone accepts for buying or selling goods 
and services, making trade much easier.
Today, we use coins, notes, and digital 
methods (like mobile payments) to conduct 
transactions.
John Maynard Keynes, a renowned 
economist, stated that money connects the 
present to the future by helping us save and 
spend later.
Why Do We Need Money?
Double coincidence of wants
The farmer must find someone 
who wants an ox and offers 
exactly what he needs (shoes, 
sweater, medicines). This is 
rare.
Common standard measure 
of value
It's hard to decide how much 
an ox is worth compared to 
shoes or medicines, as there's 
no agreed value.
Divisibility
An ox cannot be split into parts 
for smaller trades, like for a 
sweater.
Portability
Carrying an ox or bags of wheat (traded for the ox) 
to different places is difficult.
Durability
Wheat rots or gets eaten by rats, so it cannot be 
stored for long.
The barter system had many problems, making money necessary. For Example: A farmer with an ox needs shoes, a 
sweater, and medicines but faces these challenges.
These problems made trading slow and complex, so a better system was needed. Money solves these issues by being a 
common, portable, divisible, and durable way to trade.
Modern barter examples 
still exist, like:
Junbeel Mela 
in Assam
Where people 
trade roots, 
vegetables, and 
handmade 
goods for rice 
cakes and food.
Book 
exchanges
Where people 
swap old books 
for new ones.
Household 
Trades
Trading old 
clothes for new 
utensils, 
benefiting both 
households and 
vendors.