Why is money valuable?
There is a well worn adage that “money makes the world go around”. Is this true or false?
It’s true. Money is used to regulate trade all around the world. It’s not that what the money is made of is valuable. It’s more like money are points towards an item that you want.
Like I said, it helps to regulate the amount of trade that is being done.
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Money is just a medium for exchange of goods and services. Its something that we have all agreed we will accept for the majority of the things we sell, our labor, and our property and possessions. Each society can have a different kind of money until they decide to trade with other societies. At that point, an exchange rate must be determined to allow the form of money used by one group to be translated into an appropriate amount from the other group. If you have these things in place, you can trade within and between each society, and eliminate all the costly overhead of a bartering system.