Additional Questions: Money- what it is? | Introduction to Financial Markets for Class 9 PDF Download

Q.1. What is money? 

Money is a medium of exchange. It allows us to satisfy our needs and wants. Money is actually what money does.

Q.2. What is symbolic money? 

Early in pre-history, people began exchanging items that had no real value, but which had only agreed-upon value or symbolic value.
Examples are cowrie shells, salt, snails, etc.

Q.3. What is Minting? 

The Lydians in the 7th century used lumps of metals stamped with pictures to confirm their weights. The process of stamping is called minting.

Q.4. What is plastic money? 

Plastic money is a term that is used predominantly in reference to the hard plastic cards we use every day in place of actual bank notes. They can come in many different forms such as cash cards, credit cards, debit cards, pre-paid cash cards and store cards.

Q.5. What do you mean by barter system? State its limitation. 

Initially, people had to exchange one commodity with another commodity. But this kind of transaction was possible only when commodities were available according to their needs.

Q.6. Which country first invented paper money and when it was discontinued? 

The earliest paper money was invented in China during 10th the century. But in 1445 AD,China  discontinued paper money due to increase in price.

Q.7. Who introduced paper money in India and when? 

The Moguls in India introduced paper money in the year 1236 AD.

Q.8. Why creation of money was made possible? 

The creation of money was made possible because human beings had the capacity to accord value to symbols.

Q.9. Explain the sequence of evolution of money.

(i) Barter System: To get a particular commodity, people had to exchange it with another commodity. But this kind of transaction was possible only when commodities were available according to our needs and wants.
(ii) Symbolic Money: To overcome the limitation of barter system people started using symbolic money which had no real value but which had only agreed upon value. Examples are Salt, Snails, wampum etc
(iii) Metals: The ancient Egyptians used weighed amounts of precious metals.
(iv) Coins: The earliest coins were made in Turkey in the 7th century B.C. They used lump of metals stamped with pictures to confirm their weight. The process of stamping is called Minting.
(v) Paper Money: The earliest paper money was invented in China during the 10th century. Paper money was adopted in Europe much later than in Asia. The first paper mill in Europe was established in Spain in 1151 A.D. The Moguls in India introduced paper money in the year 1236 AD. The Sanskrit word RUPYAKAM means coin of silver.
(vi) Plastic Money: Plastic money is a term that is used predominantly in reference to the hard plastic cards we use every day in place of actual bank notes. They can come in many different forms such as cash cards, credit cards, debit cards, pre-paid cash cards and store cards.