DEPARTMENT OF TECHNICAL EDUCATION

ANDHRA PRADESH
Name : Md. Qadeer Rehman
Designation : HEAD OF SECTION
Branch : D.C.C.P.
Institute : K D R Govt. Polytechnic,
Wanaparthy.
Year : I year
Subject : Business Organization
Subject code : CCP-104
Topic : Money
Duration : 50 mts
Sub topic : Concepts of money
Teaching Aids : Diagrams
CCP104.136 1
Objectives
On completion of this you would be
able to:

 Explain Barter system

 Explain the defects in barter system
 Explain the need for money
 Explain the evolution of money
 Define money

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Concept
Evolution of money
 Barter system was in existence
before the invention of money
 Money has developed due to the
inconveniences of barter system
 Money developed slowly and have
to pass through many stages to get
the recognition

CCP104.136 3
Barter system

Barter has invented a system of exchange

of goods for goods in the initial stages of
civilization

 There were no common medium of

exchange before the barter system

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Barter system

Uncivilized people were unaware of money

and their wants were very limited. Almost
every family was self sufficient. Families
were short .

 When the family members increased

wants increased and the barter system
was unsuitable to exchange goods

CCP104.136 5
Inconveniences in Barter system
 Lack of double coincidence

 Lack of divisibility

 Lack of measuring value

 Lack of store value

 Lack of free transportation

 Lack of free payment methods

CCP104.136 6
Evolution of Money

 The word money derived from Latin

language and was the surname of Roman
Goddess of Juno as “Moneta”
 The evolution may be divided in to four
stages
First stage Commodity stage

Second stage Metallic money

Third stage Paper money

Plastic stage ATM/ debit/credit

CCP104.136 7
Definition of Money
Money is the most commonly accepted
medium of exchange
 Money is the means of economic growth
of a country
 Money is what money does
 A method of payment for goods and
helps in discharge of other business
obligation

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Four kinds of Money

Commodity stage : Goods, articles

and Commodities were exchanged for
commodities

 Metallic Money : Gold coins, Silver

coins, bronze coins etc. were metallic
coins after the barter system

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Four kinds of Money
Paper Money: Currency notes, Bank notes,
Demand draft, Cheques, Bills of exchange
and Hundies

 Plastic Money :ATM Card, Debit Card,

Credit Cards, VISA Card etc.

CCP104.136 10
Summary

we have discussed about :

 The Barter system and its inconveniences
 The evolution of money
 The definition of money
 The four kinds / stages of money and its
development

CCP104.136 11
Quiz
1.Exchange of goods for goods is called

c) Barter system
d) Sales system
e) Purchase of goods systems
f) Money system

CCP104.136 12
Quiz
2.The word money for money has been
derived from the

c. Great language
d. Latin language
e. Roman language
f. Sanskrit language

CCP104.136 13
Frequently Asked Questions:

2. Explain the Barter system and its

inconveniences in eight sentences .

4. Describe the evolution of money in six

sentences.

6. Explain the various stages and kinds of

money, in eight sentences.

CCP104.136 14