What is the medium of exchange?

Medium exchange is something that is used as comfort to facilitate simple and uncomplicated shop. In a net replaceable system, one commodity is replaced for another and there can be no replacement if both sides include the desire exactly what the other offers. The exchange rate system lacks the universal medium exchange to simplify the process. The media, such as money, is much easier because it does not require an accurate connection between the desires of both parties. A person can sell commodities for money and buy other commodities with this money, which eliminates the need for direct commodity exchange. The medium should be transferable; The individual should be able to carry him with him without being a terrible burden. In addition, it should be able to carry its relatively small volume and still hold a consowered amount of value and purchasing power. It should be divisible into different quantities containing small or large amounts of value based on quantity.

Another important function is recognizable; The item must be considered valuable to be possible. Usually, all the money used in a given political system is designed in specific sizes with recognizable colors and shapes. People can easily see it and do not have to worry about holding their value with different people or in different stores. All people in the system are familiar with a particular medium, so there is no debate about its value.

One of the main problems that arises when companies use conventional media exchange is counterfeiting. The medium must be designed to be very difficult to counterfeit or people can create their own version that does not have the same value. To avoid counterfeiting, Governments usually produce money with complex and difficult to replicate designs on special paper with special inks.

In modern times, the medium of exchange in many societies has even shifted to some extentpaper and coins. Money can be stored electronically and used worldwide, allowing the same exchange of goods and values ​​without any physical currency that constantly changes hands. Complex encryption methods prevent counterfeiting and other problems of exchange.