CBSE Class 7 > Class 7 Notes > Social Science - New NCERT ( Part 1 and Part 2) > Cheat Sheet: From Barter To Money
Cheat Sheet: From Barter To Money
1. Introduction and Need for Money
1.1 Overview
- Earliest trade used direct exchange of goods and services without a common medium.
- Direct exchange was inefficient for expanding trade and longer distances.
- Money evolved as a common tool accepted for buying and selling goods and services.
- Modern transactions use coins, notes, and digital methods.
- John Maynard Keynes: money connects the present to the future by helping save and spend later.
1.2 Problems with Direct Exchange
- Finding two traders who each want what the other has was rare.
- No agreed method existed to measure the value of different goods.
- Large goods could not be split for smaller purchases.
- Transporting bulky goods for trade was difficult.
- Perishable goods could not be stored for later use.
2. Journey and Forms of Money
2.1 Early Forms
- Cowrie shells
- Rai stones (Micronesia)
- Aztec copper Tajadero
- Red feather coils (Solomon Islands)
2.2 Coinage
| Term | Description |
|---|---|
| Issuance | Coins were issued by rulers for use within their kingdoms. |
| Regional acceptance | Coins of powerful rulers became accepted in other kingdoms. |
| Metal composition (ancient) | Gold, silver, copper, or their alloys |
| Names | kārṣhāpaṇas or paṇas |
| Designs | Different designs appeared on two sides of a coin. |
| Chalukya coin features | Varaha on one side and a decorated three-tiered parasol on the other |
| Maritime trade evidence | Coins found in Kerala and Tamil Nadu indicating active trade |
| Modern coin composition | Iron mixed with chromium, silicon, and carbon in exact proportions |
2.3 Paper Money
- Originated in China.
- Introduced in India in the late 18th century by the Bank of Bengal and the Bank of Bombay.
- Used for higher denominations such as ₹10, ₹100, and ₹500.
- Modern notes display cultural motifs and have raised marks for the visually impaired.
- The Reserve Bank of India is the only legal authority to issue currency in India.
2.4 Digital Money
- Money taking an intangible electronic form.
- Methods include debit cards, credit cards, net banking, UPI, and QR codes.
3. Functions of Money
3.1 Main Functions
| Function | Meaning |
|---|---|
| Medium of exchange | Used to buy and sell goods and services |
| Store of value | Can be saved and used later |
| Common denomination | Measures the value of goods for easy comparison |
| Standard of deferred payment | Allows payments to be made at a later time |
4. Names, Dates, Numbers, Authorities
4.1 Specific Facts
| Item | Detail |
|---|---|
| ₹ symbol adoption | 2010 |
| ₹ symbol designer | Udaya Kumar of IIT Bombay |
| 1 anna relation | 1 anna = 1/16 of a rupee (1947 reference) |
| Paper money introduction in India | Late 18th century by Bank of Bengal and Bank of Bombay |
| Issued denominations (coins) | ₹1 and ₹5 as coin examples |
| Issued denominations (notes) | ₹10, ₹100, ₹500 as note examples |
| Currency authority in India | Reserve Bank of India (RBI) |
| Scholarly view on trade | Scholars believe trade was favourable to India |
5. Glossary of Difficult Words
5.1 Terms and Definitions
| Term | Definition |
|---|---|
| Barter System | Exchanging goods or services without using money |
| Money | A common tool accepted for buying or selling goods and services |
| Transaction | A business deal such as buying or selling |
| Commodities | Items used for trade such as cowrie shells or cattle |
| Double coincidence of wants | When two people each have what the other wants for trade |
| Common standard measure of value | An agreed way to measure the worth of goods |
| Divisibility | The ability to split something into smaller parts for trade |
| Portability | The ease of carrying or moving something |
| Durability | The ability of something to last long without damage |
| Medium of exchange | Something accepted by all for buying and selling |
| Store of value | Something that can be saved and used later |
| Common denomination | A way to measure and compare the value of goods |
| Standard of deferred payment | Using money to pay for something later |
| Coinage | Coins used as money often produced by rulers |
| Currency | The money system of a country such as rupees in India |
| Minting | The process of making coins |
| Mint | A factory where coins are produced |
| Alloy | A metal created by combining two or more metals |
| Denominations | Different units of money such as ₹1 or ₹100 |
| Obverse | The front side of a coin with the main design |
| Digital money | Money in electronic form not as physical coins or notes |
| QR Code | A pattern of squares scanned by phones for digital payments |
The document Cheat Sheet: From Barter To Money is a part of the Class 7 Course Social Science Class 7 - New NCERT ( Part 1 and Part 2).
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