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The above statement is correct. Money increases productivity of capital. In the sense, with money, more capital can be raised. Since increased capital implies purchase of better machinaries that produce superior quality products in less time, it leads to an increase in output and thereby increases productivity of the capital.

No, I do not agree with the statement. 

Although paper money has many advantages and it has economized the use of precious metals it suffers from the following disadvantages:

• The government may over the issue when there is a deficit in the budget and this may lead to inflation. 
• It is less durable as compared to metallic money. 
• It can be circulated only in the domestic economy, it is not useful for international trade.

No, I do not agree with the statement. 

• Money performs an important function as a store of value.
•  Although wealth can be stored in a form other than money, money is the most convenient form in which wealth can be stored. Since money is the most liquid asset, it can be used for future use whenever needed.
• Money can be stored without the loss in its value. 
• This was not possible under barter exchange because goods could not be stored for a long time and there could be lost in the value of commodities. 
• This function of money enables people to save a part of their income and store it for future use. 
• Savings lead to capital formation which in turn will lead to the economic development of a country.

Any commodity can’t act as money. For something to be used as money it must possess the following qualities.

i. General acceptability: Good money is the one which is readily accepted by all without any reluctance.

ii. Divisibility: Any commodity acts as good money if it can be divided into small units. For example, currency notes, gold, silver, and coins possess divisibility quality as it can be divided into different denominations.

iii. Durability: It should possess the quality of durability. That is, it should be long lasting. As currency coins are made up of metal, these are more durable compared to currency notes.

iv. Cognizbility: By cognizibility, we mean that good money is the one which is easily recognisable by all the members of the society and so no special efforts are required to recognise it.

v. Portability: It should be easy to carry from one place to other without any expenses and inconvenience.

vi. Homogeneity: Money of the same denomination should be homogenous in size and quality. For example, all 5 rupees coin should be of the same size, colour etc.

vii. Stability of value: Anything which is used as money should be stable in the sense that its value of money should not change frequently.

Correct Option (3) a, b, d

Various changes and instructions are given by the banks for the safe use of plastic money:

• Do not save the 16 digit card number using multiple payment gateways. 
• On the backside of the card, there is 3 digit number which is an added security feature that protects our card from making fraudulent transactions. 
• For safe usage, a One Time Password (OTP) is provided by the bank on a client’s personal registered number (mobile number) to use for each transaction. 
• Banks are instructed by RBI to move to chip and pin-based cards and avoid the use of magnetic stripe cards. The chip and pin-based cards create a unique token, every time the card is used. This provides a higher level of security than the magnetic strip.

Yes, I do agree with the statement..

• With the invention of new technologies, like mobile phones, tablets, smart cards, computers, etc, money can be sent anywhere nationally or globally. 
• E-money is a monetary value that is stored and transferred as and when desired through various means. 
• It is the safest mode of transfer as it is backed and monitored by the Central Bank. 
• It is also called a digital wallet. 
• Hence, money can be sent anywhere through elect
• ronic means.

Poor men need not go up as rich men should come down. This statement is perfectly true. The poor will survive. Living a simple, real life, and working hard. They are happy with necessities which may not be expensive. They are content and that brings happiness. They do not have to worry about safeguarding the excess.

But the rich may not know how to live simply, just with basic necessities. They may have servants to do basic chores. They travel in style and sometimes for no reason. They spend unnecessarily. So the poor need not go up as much as the rich need to come down is true.

Yes, I do agree with the statement. Money performs a number of functions in today’s economy.

They are as follows:

Medium of Exchange: It serves as a medium of exchange, i.e. any commodity can be purchased or sold for money. 

The measure of Value: Money helps to compare the price of commodities in the modern economy, which was not possible during the Barter period. Value of commodity can be expressed in different currencies like Rupee in India, Dollar in the U.S.A., etc. 

Standard of deferred payment: Deferred payment means making payment at a future date. This was not possible in a barter economy, because taking loans was easy, but its repayment was difficult as the loan was in form of grains, cattle, etc.

Store of value: Money made possible the habit of saving for the future. Saving was not possible during the barter economy as commodities started deteriorating after a certain period of time. But with the invention of money, now it can be saved for a longer period. 

Transfer of value: Transfer of money from one person to another and from one place to another place, became possible due to the invention of money.

Contingent Functions: Besides the above functions of money, there are other functions of money, like 

• it helps to measure National Income. 
• it forms the basis of credit. 
• it imparts liquidity to wealth. 
• it helps to estimate macroeconomic variables.

Happiness is in the mind. If a person is satisfied with what is on hand then he is happy. Rich clothes, gold, expensive food, servants may all be available. But the owner of these may still be sad and lonely.

Some are happy to make music another may create art or write. They may not have material possessions. But in their hearts they are happy to do what they love.

Money is only a medium to purchase our needs. One cannot give money and buy a bag of joy. Joy is in the heart. Money can be stolen. But joy cannot be stolen. One can earn money but not happiness. No amount of money will satisfy greed or buy happiness.

Points: 

1. Money is a resource. 

2. Resources should be available/ used in times of need 

3. Money is accumulated by few people/others in need are deprived/some people are not paid fully/workers are paid less for their time and energy 

4. Employer gets profit/ imbalance of resources 5. Imbalance in wealth causes discontent among disadvantaged sections of society. 

6. Crime increases 

7. Haves are targeted by have-nots 

8. Normal life becomes unstable 

9. Accumulation of money causes this upset in society 

10. So important resource becomes reason for evil

(a) Calm and good tempered at all times 

(b) Helpful and concerned about anyone in trouble 

(c) Quick to intervene/calm down any situation that could become unpleasant 

(d) Very simple and down to earth in spite of coming from an extremely wealthy background

The following are the qualities of good money:

i. General acceptability: Good money is the one which is readily accepted by all without any reluctance. This quality is possessed by gold and silver.

ii. Divisibility: Any commodity acts as good money if it can be divided into small units. For example, currency notes, gold, silver and coins possess the quality of divisibility as they can be divided into different denominations.

iii. Durability: It should possess the quality of durability. That is, it should be long lasting. As currency coins are made up of metal, these are more durable compared to currency notes.

iv. Cognizibility: By cognizibility, we mean that good money is the one which is easily recognisable by all the members of the society and so special efforts are not required to recognise it.

v. Portability: It should be easy to carry from one place to other without any difficulty, expenses or inconvenience.

vi. Homogeneity: Money of the same denomination should be homogenous in size and quality. For example, all Rs. 5 coins should be of the same size, colour etc.

vii. Stability of value: Anything which is used as money should be stable in the sense that their value should not change frequently.

Qualities of good money are as follows: 

• General Acceptability: It must be generally accepted as a medium of exchange. 
• Stability of Value: The purchasing power of money should be stable because money serves as a store of value. 
• Cognizability: It must be easily recognizable or identifiable. For E.g. Notes of different denominations must be of different sizes, colours, etc., so that they can be easily identified. 
• Durability: Money should be durable also. Its value should not fluctuate too much.
• Divisibility: Money should be divisible into units of smaller denominations. 
• Portability: It should be easy to handle and carry from one place to another. 
• Homogeneity: Money of the same denomination should be identical in shape, size, colour, etc.

Yes, I agree with the statement. There are many good qualities found in a modern currency like:

• General Acceptability: It must be generally accepted as a medium of exchange.
• Stability: The purchasing power of money should be stable because money serves as a store of value. 
• Cognizability: It must be easily recognizable or identifiable. For E.g Notes of different denominations must be of different sizes, colours, etc. so that they can be easily identified. 
• Durability: Money should be durable also i.e. its value should not fluctuate too much. 
• Divisibility: Money should be divisible into units of smaller denominations.
• Portability: It should be easy to handle and carry from one place to another.
• Homogeneity: Money of the same denomination should be identical in shape, size, colour, etc.

(a) False. The poet had no joy as long as he was rich. He was happy when he was poor.

(b) False. He could not talk about his money.

(c) False. When the poet had money, all his friends were false ones.

(d) True

Barter System. 

The barter system refers to the exchange of goods against goods. In the above case, it is a barter exchange as Vasantsheth exchanges coal against food grains.

Cheque/Demand Draft

Bank Money. 

Bank money or credit money refers to cash deposits saved by people. It can be withdrawn or transferred or demanded by means of cheque, draft, etc. In the above case, it is bank money, because Mr. Babanrao deposits his cash into the bank as deposits.

1. Student Savings Account: There are savings accounts some banks offer specifically for young people enrolled in high school or college, and they main feature more flexible terms such as lower minimum balance requirements.

2. Savings Deposits: Savings deposits are opened by customers to save the part of their current income. The customers can withdraw their money from their accounts when they require it. The bank also gives a small amount of interest to the money in the saving deposits.

3. Current Account Deposit: Current accounts are generally opened by business firms, traders and public authorities. The current accounts help in frequent banking transactions as they are repayable on demand.

4. Fixed Deposits: Fixed deposits accounts are meant for investors who want their principle to be safe and yield them fixed yields. The fixed deposits are also called as Term deposit as, normally, they are fixed for specified period.

A bank that offers services to the General public and companies is a commercial banks. 

The types of deposits in a commercial bank are 

1. Time deposits. Example Fixed deposit 

2. Recurring deposit and Demand deposit Example Current Account and Savings Account.

(b) Ending the legality of legal currency

Plastic Money.

 Plastic money is optional money in the form of Debit cards and Credit cards. In the above case, Charu purchases a shirt with a debit card. Hence, she is using a form of Plastic money.

Correct Answer is Portability

Black money. 

Money that is received in cash but not accounted for and on which tax is not paid to Government is called Black Money. In the above case, the agent did not issue a receipt to Malathi, hence it will be a case of Black money.

The Mughals Empire from 1526 AD consolidated the monetary system for the entire empire.

(c) Reserve Bank of India

Correct Answer is Money

(i) Concept of black money: Black money is unaccounted money which is illegally obtained and not declared for tax purposes. It encourages illegal activities, corruption, bribes, etc. This creates an obstacle to economic development.

(ii) Electronic Money: It is also called E-money. It is a monetary value that is stored and transferred electronically through mobile phones or tablets or smart cards or computers. It is backed by Central Bank and is used for purchases and other transactions globally.

Yes, I agree with the statement. 

• Money is the most liquid asset because it is generally acceptable.
•  It is a 100% liquid asset in the sense that it can be converted into any type of asset with no loss in its value
• Money helps to transfer immovable properties like land by selling it at one place and purchasing similar property at another place or from one person to another without any difficulty. 
• In other words, it makes illiquid assets like land, buildings, etc., into liquid assets.
•  Money as a store of value is also the most liquid asset, as compared to other assets like diamonds, houses, land, etc.

Money is one of the most fundamental inventions of mankind. “Every branch of knowledge has its fundamental discover”. In mechanics, it is the wheel, in science fire, in politics the vote. Similarly in economics, in the whole commercial side of Man’s social existence, money is the essential invention on which all the rest is based.

‘Rupya’ in Sanskrit mean Silver coin.

(b) ii and iii are correct

1. iii 

2. iv 

3. i 

4. ii

(a) 15 July 2010

The root cause for the increasing rate of black money in the country is the lack of strict punishments for the offenders.

1. Kind Midas 

2. Indo – Greek Kushan 

3. Turkish 

4. Tanka, Jittal 

5. Rupiya 

6. Farrukhsiyar 

7. Inverse 

8. Udayakumar 

9. Money 

10. 8 November 2016

Correct answer is (c) Keynes

(c) Hartley Withers

Limited legal tender money: Legal tender money is that money which is backed by law and issued by the monetary authority. It cannot be refused by anybody. Limited legal tender money is that money which is accepted as legal tender but only up to a certain limited amount. In India, a maximum of 1000 coins be used for payments legally.

Correct Option (2) a, b, c

Bartering doesn’t involve money.

The Mauryas came up with the Punch Marked Coins minting of silver, gold copper or lead.

Barter exchange refers to the exchange of goods for goods

Rural cooperative credit institutions.

(c) I, III and IV is correct

1. Under pressure from India and other countries, Switzerland has made key changes in its local laws governing assist foreign allegedly stashed in Swiss Banks.

2. Special Investigation Team appointed by government on the directions of Supreme Court on black money. 

3. Demonetization

Benefits of Savings 

1. You will be financially independent sooner. 

2. You would not have to worry any unforeseen expenses.

3. In future, you will have financial backup in place if you lose your job. 

4. You will be prepared if your circumstances change. 

5. You will be more comfortable in retirement. 

6. Save today for better tomorrow.

1. Net Banking

2. Money 

3. German 

4. The purchasing power 

5. 1949