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The Nature & FunctionThe Nature & Functionof Money of Money 
The simple definition of moneyThe simple definition of money
Any thing that is generally acceptable as a means of Any thing that is generally acceptable as a means of exchange and that at the same time acts as aexchange and that at the same time acts as ameasure and store of value is money.measure and store of value is money.Money is anything which is widely accepted inMoney is anything which is widely accepted in payment for goods, services or discharge of other  payment for goods, services or discharge of other kind of business obligationskind of business obligations
 
 
ApproachApproach
Money ………………Money ………………
MM
Currency……………..Currency……………..
CC
Demand Deposits……Demand Deposits……
DDDD
Time Deposits……….Time Deposits……….
TDTDM = C + DD + TDM = C + DD + TDA temporaryA temporaryabodeabodeof purchasing of of purchasing of power by being held in the form of power by being held in the form of currencycurrency
 
 
Liquidity ApproachLiquidity Approach
Gurley and Shaw given the liquidity approachGurley and Shaw given the liquidity approach
The assets which are close substitutes of money andThe assets which are close substitutes of money andcan be converted into money quickly have beencan be converted into money quickly have beenincluded in the character of money.included in the character of money.ThusThus
moneymoney
is equal tois equal to
Currency+Demand Deposit+Time Deposits+Currency+Demand Deposit+Time Deposits+Saving Bank Deposits+Shares+BondsSaving Bank Deposits+Shares+Bonds
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