Question

State with reasons whether you agree or disagree with the following statement.
Good money has many qualities.

Answer 1

Yes, I agree with the given statement.

The Qualities of good money are:

1. General Acceptability- Unless a person knows that the money which he accepts in exchange for his goods or services will be taken without any objection by others as well, he will not accept it.

2. Portability- It should be easily and economically transported from one place to the other.

3. Durability- Material used as money must be able to last long without wear and tear.

4. Homogeneity- All portions or specimens of the substance used as money should be homogeneous, that is, of the same quality, shape, size, colour etc.

5. Divisibility- The money material should be capable of division into smaller amounts.

6. Cognizability- It should be easily recognisable and distinguishable from all other substances.

7. Stability of Value- The value of a material, which is used to measure the value of all the other materials, must be stable.