Meaning of Money (What it is, Concept and Definition)

money is a kind of instrument used in the form of coins and notes, used in the company's commercial exchanges.

Money then serves as a monetary instrument used to carry out trade in goods, services and all kinds of action for which we need to commit a certain amount.

The etymological origin of the word money refers to the Latin denarius, name given to the currency that the Romans used for their commercial exchanges.

Money is also related to everything that refers to economic terms and possessions, such as stocks, bonds, material possessions, and family inheritance.

It gathers some characteristics considered basic to be a widely used means of commercial exchange. It is seen as an accounting unit, which allows you to check and compare the value of products and services, if these values ​​are very different, in addition to being something considered as a store of value that can be done savings. It also facilitates commercial exchanges in a more practical way as it is an object that is easy to store and transport.

It is important to remember that money as we know it (in the form of coins and banknotes) has other names in different countries, which vary in value depending on the currency, such as the euro, the real, the pound, among others. This value that is assigned is not the one that appears on the note paper or the metal of the coin. It works through a social pact that is accepted by all members of society and its effect is only guaranteed with authorization and certification from the issuing entity, such as the Central Bank.

origin of money

Money, as we know it today, originated through trade and barter. The merchandise went through an evaluation that took into account the production time and the labor power spent to manufacture the product. After the creation of money, this commodity value became independent of the labor force committed to produce it.

This development of money then allowed the expansion of commerce on a large scale and the rise of banks also initiated a new financial trade exchange where money is the commodity. However, money managed to facilitate the activity of commerce and make it simpler.

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