Chapter Based Questions: Money- Exchange Systems | Introduction to Financial Markets for Class 9 PDF Download

Q.1. Choose the correct answer.

(i) People in early civilization w ere too busy worrying about _________ .
(a) survival
(b) savings
(c) education 

Correct Answer is Options (a)

(ii) Specialization means people become ________ . 
(a) hard working
(b) more skilled
(c) more intelligent 

Correct Answer is Options (b)

(iii) In our early history, the degree o f division of labour was _______________ . 
(a) plenty
(b) limited
(c) not found 

Correct Answer is Options (b)

(iv) __________________ is one of the difficulties in using commodities as money.
(a) Hard to carry
(b)  Measuring
(c) Conversion 

Correct Answer is Options (a)

(v) Metal objects in different forms and shapes were introduced as money many years ago probably around __________ .
(a) 2000 BC 
(b) 4000 BC 
(c) 5000 BC 

Correct Answer is Options (c)

Q.2. Fill in the blanks.

(i) ______ is anything that is commonly accepted by a group of people for the exchange of goods, services, or resources.
(ii) Money is used as the ______ between the buyer and the seller for the goods purchased.
(iii) Red Indians were able to provide ______ for trade with the Europeans.
(iv) Money is also called as ______.
(v) The currency used in Germany is called ______.

(i) Money

(ii) Medium of exchange

(iii) Furs

(iv) Medium of exchange

(v) Euro

Q.3. Match the following.

(i) Specialisation - paise
(ii) Red Indians - surplus beyond the personal need
(iii) Commodity money - good at hunting
(iv) Fractional Rupees - division of labour
(v) Trade - a basic item used by everyone in the past

(i) Specialisation - division of labour
(ii) Red Indians - good at hunting
(iii) Commodity money - a basic item used by everyone in the past
(iv) Fractional Rupees - paise
(v) Trade - surplus beyond the personal need

Q.4. True or False.

(i) As long as the output of the economy is made up of relatively few goods and services, the barter system can function successfully.
(ii) In the past, salt, tea, tobacco, cattle and seeds were once used as money.
(iii) Since coins were given a certain value, it became difficult to compare the cost of items people wanted.
(iv) In modern societies today, coins and paper money are the most commonly used forms of money.
(v) Metal coins cannot be recycled.

(i) True
(ii) True
(iii) False
(iv) True
(v) False

Q.5. Answer the following briefly.

Ans: Trade involves the exchange of goods and services between individuals or entities. In early civilizations, people engaged in barter systems, trading surplus goods to obtain needed items. As societies evolved, the introduction of money simplified trade by providing a standardized medium of exchange, facilitating easier and more efficient transactions. 

(ii) Describe briefly the division of labour. 

Ans: Division of labour refers to the specialization of individuals in specific tasks or roles within an economy. This specialization increases efficiency and productivity as people become more skilled in their particular tasks. Historically, this led to the development of various trades and professions, enhancing overall economic growth and societal development.

(iii) What is commodity money? 

Ans: Commodity money refers to the use of physical goods, such as salt, tea, tobacco, or metals, as a medium of exchange. These commodities have intrinsic value and were widely accepted in trade before the advent of modern currency systems. They facilitated trade by providing a tangible and universally recognized medium of exchange.

 (iv) Describe briefly about money used in India. 

Ans: The primary currency used in India is the Indian Rupee (INR). Coins and paper money are common forms of currency, with denominations ranging from small coins like paise to larger notes in rupees. The Indian Rupee is the medium of exchange for goods and services in the economy, facilitating trade and economic transactions efficiently. 

Q.6. Answer in detail.

(i) Explain bartering and commodity money.