what is the concept of global economy in transfer of value as a function of money?
what is the concept of global economy in transfer of value as a function of money?
Transfer of value as a function of money means money acts as a good medium to transfer the value of goods and services from one person to other.For instance, when we sell or buy second hand car or any other good,the buyer pays the value worth of the good to the seller and the medium of the transaction is money.
Now,at global level too,money holds equally important role. A good which is produced and sold by US has its price quoted in USD and an Indian buyer converts his/her currency into dollars and then pays for the good.The transaction involves two steps. First,changing rupee into dollar (how much "value" does rupee holds in terms of dollars) and then dollars to the good(how much "value" the good holds in terms of dollar).SO,it is the money which is allowing us to exchange goods and services and even currencies both domestically and globally. Remember,a global economy is the one which can carry on trade at international level.
Transfer of value as a function of money means money acts as a good medium to transfer the value of goods and services from one person to other.For instance, when we sell or buy second hand car or any other good,the buyer pays the value worth of the good to the seller and the medium of the transaction is money.
Now,at global level too,money holds equally important role. A good which is produced and sold by US has its price quoted in USD and an Indian buyer converts his/her currency into dollars and then pays for the good.The transaction involves two steps. First,changing rupee into dollar (how much "value" does rupee holds in terms of dollars) and then dollars to the good(how much "value" the good holds in terms of dollar).SO,it is the money which is allowing us to exchange goods and services and even currencies both domestically and globally. Remember,a global economy is the one which can carry on trade at international level.
