Question

Answer the following question on the basis of the following information:

Ganesh travelled to the mall by bus. He gave the conductor ₹ 10 coins for the ticket. He purchased many commodities from the mall.

At the billing counter, he gave his credit card for payment but the billing clerk informed him that only debit cards were accepted. Since Ganesh had forgotten his debit card at home, he offered to make payment in cash.

1) Identify the types of money used in the information.

2) Explain any two of them.

Answer 1

1. The types of money used in the information are Metallic coins, Plastic money, and Paper money.

2. The two types of money are:

1. Metallic coins: In ancient times, rulers of various kingdoms used small pieces of metal and affixed their seals on them. With the passage of time, the monetary system was taken over by the government authorities with a view to giving uniformity and legal status to metallic coins. Coins can be classified as under:
   a) Standard or full-bodied coins: Full-bodied coins are those whose face value is equal to their intrinsic value. Face value indicates the exchange value fixed by issuing authority. These coins are made out of precious metals like gold, silver, etc. Standard coins were used for some days during the British period.
   b) Token coins: Token coins are those whose face value is higher than their intrinsic value. These coins are made of cheaper metals like aluminum, nickel, etc. These coins are of lower denominations and are generally used for settling smaller transactions. In India, all coins in circulation today are token coins. Difficulties in the transportation of token coins gave rise to paper money.
2. Paper money: Money made out of paper is called paper money. It is comparatively more portable and less durable.