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**20 MAR** **ECONOMICS** **PILLAR 7 A(i)** **MONEY, BANKING,FINANCE,INSURANCE** **Barter System** **Pros** 1. No danger of fake currency 2. Easy for Trade 3. No need to carry for Rs.2/- exchange **Cons** 1. Double co-incidence of goods must be present. 2. Search cost/cost of transaction 3. Storag...

**20 MAR** **ECONOMICS** **PILLAR 7 A(i)** **MONEY, BANKING,FINANCE,INSURANCE** **Barter System** **Pros** 1. No danger of fake currency 2. Easy for Trade 3. No need to carry for Rs.2/- exchange **Cons** 1. Double co-incidence of goods must be present. 2. Search cost/cost of transaction 3. Storage of perishable commodity is a loss of value. **Money system** 4. Money lys encourage specialization I'n division of labour/whires barter system does not. Money is a commodity which can measure value of labour/capital, land , comp., govt.'s budget and country's GDP. Money is divisible and fungible. 7 **Primary Fxn of Money** 1. **Measure of value** * Money is hard to counterfeit/transfer/transport * Money is medium of exchange/transfer & acceptable.