Money

               

In the old generations, most of the people buying goods or services by using barter system. They exchange their goods with each other to get what they want. This system bring a lot inconvenient to us such as , wasting our time , we have to think who to exchange with , and how many we got to exchange with. For an example, when a fisher wants to buy a chicken, he will exchange 5 fishes that he has with the farmer that wants to buy fishes. But if the farmer did not want to buy fish on that time, the fisher will get rejected and have to find another farmer or just exchange other goods with his fishes. After this system, people start to create money by using different types of materials, such as circular stones, elephant-tail bristles, gold coins, and also fur. Anything that can be accepted as medium of exchange will be serving as money. 

                For the early generations before us, they started to create money by using paper with a unit showing on it. Money is a medium of exchange that is usable for buying and selling goods and services. Money makes our life more convenient so that we no need to suffer the complications of barter system. For an example, the firm sells us goods by a price label, we just have to consider we want to buy or not and we will pay or just leave the shop.

                Meanwhile, money is also a unit of account. In Malaysia we use Ringgit Malaysia as the monetary units. When the money has it's own unit so that customer can buy the product with a worth price. For an example, money with a unit is easy for the customer to compare the price of the same product in different shops so that the customer can buy the product with the minimum cost or not buying it. The unit of money can also help us clearly define the debt obligations, determine the taxes owned, and calculate the nation’s GDP.

                Lastly, money is also a store of value that people can use to transfer the purchasing power from the present to the future. Most of the people won’t use their money in once. They will mostly save some for the next time transaction. At this moment, most of them will store their money in the safer place they think. Some will store in the back to get interest or some will buy houses for investment or to get rent. Then, holding your wealth is the relatively risk free way to store the money for later use when inflation happen.