The role of money and banking in the economy is a fundamental concept in CBSE Class 10 Economics. Understanding this concept is crucial as it helps students comprehend the functioning of the economy and how money and banking systems influence various economic activities. Here is a detailed explanation of how you can enhance your understanding of this topic:

1. Importance of Money:
Money plays a vital role in the economy as it acts as a medium of exchange, unit of account, and store of value. It facilitates the exchange of goods and services, enables comparison of prices, and allows individuals to save for future use. Understanding the importance of money helps in comprehending its significance in economic transactions.

2. Functions of Money:
Money serves several functions in an economy, namely:
- Medium of exchange: Money acts as a widely accepted medium for the exchange of goods and services.
- Unit of account: Money provides a standard unit for measuring and comparing the value of different goods and services.
- Store of value: Money allows individuals to save their wealth for future use.

3. Types of Money:
There are different types of money in circulation, such as:
- Commodity money: Money that has intrinsic value, like gold or silver.
- Fiat money: Money that has value because the government declares it as legal tender, such as paper currency.

4. Banking and its Functions:
Banks play a crucial role in the economy by providing various financial services. Understanding the functions of banks is essential:
- Accepting deposits: Banks accept deposits from individuals and businesses, allowing them to safeguard their money.
- Providing loans: Banks lend money to individuals and businesses for various purposes, promoting economic activities.
- Credit creation: Banks have the power to create credit by lending a fraction of the deposits received, which stimulates economic growth.
- Facilitating payments: Banks provide payment services through instruments like checks, debit cards, and online transfers.

5. Central Bank and its Role:
The central bank is the apex financial institution in a country. It performs several vital functions:
- Regulating the money supply: The central bank controls the money supply in the economy, ensuring stability and preventing inflation.
- Acting as a banker to the government: The central bank manages the government's accounts, handles its borrowing requirements, and facilitates the smooth functioning of the economy.
- Regulating the banking system: The central bank supervises and regulates commercial banks, ensuring their stability and soundness.

6. Monetary Policy:
Monetary policy refers to the actions taken by the central bank to control the money supply and influence interest rates. Understanding the objectives and tools of monetary policy is crucial for comprehending its impact on the economy.

By studying and exploring these aspects of money and banking in the economy, you can enhance your understanding of their role in CBSE Class 10 Economics. It is also recommended to refer to the NCERT textbook, practice sample papers, and solve previous year's question papers to gain a better grasp of the subject.