Note on Currency

  • Note
  • Things to remember
  • Videos
  • Exercise
  • Quiz

currency

In the past, people used to produce the essential things in their own home. They used to exchange the goods and other materials with their neighbours which are essential to them. In this way, people used to exchange the goods and services without using medium of exchange, such as money. This system is known as batar system. The batar system became ineffective with the increment of the economic activities. Then, it was started to search the universally accepted material instead of exchanging system. Animals and their skin, the carapace of the tortoise, hole in the hard material, etc. were used instead of the exchange of goods. The metals such as gold and silver were used as the means of exchange with the development. Notes have become the most popular means of exchange in present days. The shape and structure of currency had changed with the development of human civilization. Nepal Rastra Bank, in our country, issues paper notes & coins and circulates throughout the country. Few countries of Europe has brought the trend of a common currency which is called Euro. The currency of America is called Dollar.

A country cannot issue more and more notes to be rich. It should take the permission of International Currency Fund of UNO to issue the note. The fund gives the permission to issue note according to the capacity to utilize the goods and services by the citizen. The value of the currency should be according to the valuable metals, such as gold. Then only, the bank can issue notes as per the requirement.
The foreign currency is essential to import goods from foreign countries. We should export goods in order to earn currency of foreign lands. Foreign currency can also be earned by working in foreign lands. Foreign currency can also be earned if the foreigners spent their money while their visit to Nepal. It can also be earned through donations and loans from foreign countries. The most reliable means to earn foreign currency is trade and tourism. But nowadays many Nepalese are going foreign land such as Saudi Arab, Malaysia, Qatar, South Korea, japan, etc. for foreign employment. They earn foreign currency there and send it to their family and relatives in Nepal through remittance.

  • A system of money in common use especially in a nation is called currency.
  • People used to exchange the goods and services without using medium of exchange, such as money. This system is known as batar system.
  • The currency of America is called Dollar.
  • The batar system became uneffective with the increment of the economic activities. 
  • Foreign currency can also be earned by working in foreign lands. 
  • The foreign currency is essential to import goods from foreign countries. 
.

Very Short Questions

People used to exchange the goods and services without using medium of exchange, such as money. This system is known as batar system. Batar system is the old method of exchange.

0%
  • The Euro is the name for ______.

    a common European currency
    a type of sandwich
    a currecncy deposited outside its country of origin
    a bond sold internationally outside of the country in whose currency the bond is denominated
  • People used to exchange the goods and services without using medium of exchange, such as money. This system is known as ______.

    deuki system


    batar system


    dowry system


    kamaiya system


  • Which of the following applies to money when it serves as a store of value?

    The more stable money's value, the better it serves as a store of value.


    Money is a store of value because it is an agreed measure for stating goods' prices.


    When money serves as a store of value, it requires a double coincidence of wants.


    All the options are correct


  • Which of the following is money?

    checking deposits


    checks in the checkbook


    All of the above are money


    credit cards


  • Controlling the quantity of money and interest rates to influence aggregate economic activity is called ______.

    monetary policy


    bank antitrust policy


    foreign policy


    fiscal policy


  • You scored /5


    Take test again

DISCUSSIONS ABOUT THIS NOTE

You must login to reply

Forum Time Replies Report

Characteristics of good money


You must login to reply

write a process of printing currency by a country?


You must login to reply

Ashim Acharya

How money has helped in the operations of our economic activities ?


You must login to reply

Ashim Acharya

What are the difficulties and constraints of barter system ?


You must login to reply