Why Money Is Important

Marketing: Money occupies a central position in our economy. Money is for everything in the contemporary life and everywhere. Money became the faith of the day in the business of life. Money is the pivot around Since Marshall put. And, the major portion of this subject matter of economics is concerned with this functioning and malfunctioning of currency." . The benefits conferred by the usage of credit construction, money and the changes have profound influence on mankind today's behavior. Every branch of financial activity in a money economics is different from what it'd have been in a barter economy. As Robertson states, society is helped by a financial economics presence to make the best use of its productive power, and to find exactly what people want and how much they need it amounts.


And it helps every member of society to be certain the way of pleasure to that he's access give him the best quantity of actual enjoyment that's in his reach." . Money has created a far reaching impact on all facets of activities: production, consumption, distribution and exchange, as also on finance and wellbeing. Currency and Consumption: Currency enables a consumer to generalise his buying power. Currency provides freedom of choice of consumption. Money and the price mechanism helps a consumer to allocate his income over goods at such a way in order which he derives maximum satisfaction from their consumption.

Money and Production: At the modern world, industry is tightly wrapped in the garment of cash, says Pigou. The institution of cash has made present day mass production possible. Without money, production on a large scale will be impossible. For: Money has made extreme division of labor possible. Entrepreneurs are concerned, while planning their productive activities, with this cost of production and selling prices along with the resulting profit, all calculated with regards to money. The use of cash enables a manufacturer to concentrate on the organization of the production process. Money provides a foundation for encouraging more complicated methods of organising production.

Currency has facilitated borrowing and lending and these are essential at current day production. Credit is the primary pillar of modern business. Currency is this most liquid and general form of capital that is extremely mobile between different regions and industries. Money helps the manufacturer to discover throughout the price mechanism exactly what buyers want and how much they want, in order which he can produce and supply accordingly. Therefore, rapid exchange in a modern financial system is possible because of cash. Money is based on the pricing mechanism through which financial activities are adjusted. Currency and Distribution: Currency eases this process of distribution of factors rewards like wages, interests and profits that are all measured and disbursed with regards to money.