Class 10Functions_of_Money_Presentation.pptx

functions of money
primary secondary
contingent

1. The Functions of Money The Department of Economics AGCS Park Street This Photo by Unknown Author is licensed under CC BY-SA

2. The Functions of Money

3. Crowthers definition of money; According to  Geoffrey Crowther , money is defined as "anything that is generally accepted as a means of exchange and that at the same time acts as a measure and a store of value," This Photo by Unknown Author is licensed under CC BY

4. What is Money? • Anything generally accepted as a medium of exchange • Removes limitations of barter system • Acts as a standard of value 💡 “Money is the oil that keeps the economic engine running.”

5. Classification of Functions Money performs three main functions: 1. Primary Functions 2. Secondary Functions 3. Contingent Functions

6. Primary Functions – The Foundation 1. Medium of Exchange – Simplifies trade (e.g., paying ₹500 for groceries) 2. Measure of Value – Common measure for all goods (e.g., comparing prices of book and burger)

7. Secondary Functions – The Supporting Roles 1. Store of Value – Keeps value for future (e.g., savings) 2. Standard of Deferred Payments – Enables loans and future payments [ 3. Transfer of Value – Moves value between people/places (e.g., UPI transfer)

8. Contingent Functions – The Additional Roles 1. Basis of Credit – Helps in credit creation 2. Maximisation of Profit – Money helps the producer in deciding quantity of different FoP to be employed. 3. Maximization of Utility – Helps allocate income wisely 4. Distribution of Income – Used for paying wages, rent, profit, etc.

9. Why These Functions Matter • Promotes trade and specialization • Encourages saving and investment • Facilitates credit and growth • Connects markets and people

10. Summary Table Primary: Medium of Exchange, Measure of Value Secondary: Store, Standard, Transfer Contingent: Credit, Income, Utility, Distribution

11. Conclusion 💬 “Money is not everything — but without it, everything stops.” • Unites all parts of an economy • Lifeblood of trade and growth

12. Thank You Any Questions? 💰