Question

5) explain the following terms in connection with the connection with the payment system cheque, electronic funds transfer,debit and credit notes

b)comment on the following functions of money a means of payment,a unit of accounts,a store of value

c) make commentaries on the following types of money commodity money, representative money.

Answer 1

a)Electronic funds transfers (EFTs) are fundamentally electronic watches that consequently debit the payer's record and credit the payee's record. EFTs don't require clearinghouses in light of the fact that the directing data is contained in the electronic message. Debit Note and Credit Note are utilized while the arrival of products is made between two organizations. Debit Note is given by the buyer, at the hour of restoring the merchandise to the seller, and the merchant gives a Credit Note to advise that he/she has gotten the brought products back.   A Check is a record which arranges a bank to pay a specific measure of cash from an individual's record to another person's or organization's record in whose name the check has been made or given. The check is used to make sheltered, secure and helpful installments. b)Money as a means of payment, It can be transferred to another proprietor before its value is changed over into money. The vender accordingly turns into a lender, and the purchaser an account holder. Because of this hiatus among sale and payment money acquires still another capacity; it turns into a means of payment. Money is a kind of asset that individuals normally use to purchase products and enterprises in an economy. One of the most important characteristics of money is that it fills in as a unit of account. A unit of account is something that can be utilized to value merchandise and enterprises, record obligations, and make calculations. At the end of the day, it's a measurement for value. Money is a sort of asset in an economy that you can use to purchase products and enterprises from others or organizations. One of the elements of money in an economy is that it fills in as a store of value. A store of value is something that individuals use to transfer purchasing power from the present to what's to come. While money is an asset that can store value, it's by all account not the only kind. Gold and silver, for example, act as stores of value. C)Money is a sort of asset in an economy that is utilized to purchase merchandise and enterprises from others. A commodity is a physical thing that is readily interchangeable with another thing of the same sort. Commodity money is a commodity that has inherent value. Natural value means that the commodity has value regardless of whether it isn't utilized as money. In the midst of monetary strife, for example, serious financial downturns or hyperinflation, individuals now and then go to commodity money instead of the money authorized by their legislatures... Representative money is any vehicle of exchange, often imprinted on paper, that speaks to something of value, however has practically zero value of its own. In contrast to certain types of fiat money, real representative money must have something of inborn value supporting the face value