2. WHAT IS MONEY
• Money is any good that is widely used
and accepted in transactions involving
the transfer of goods and services
from one person to another.

3. FUNCTIONS OF
MONEY
Medium of exchange :
• Medium of exchange
facilitates transactions.
• Buyers uses it for purchases
and sellers accept it.

4. STORE OF VALUE :
•In order to be a medium of exchange,
money must hold its value over time; that
is, it must be a store of value.
Money may not even be the best store of
value because it depreciates with
inflation. However, money is
more liquid than most other stores of
value because as a medium of exchange,
it is readily accepted everywhere.

5. Unit of account:
•A common unit for measuring the
value of every good or service.
• Money can be used as a means to
compare the values of goods and
services
•You can use the monetary value
assigned to a specific good or
service to compare it to one
offered by a different provider.

6. STANDARD FOR DEFERRED
PAYMENTS:
•An agreed unit of measure that
enables people to contract for
future payments and receipts.

7. CHARACTERISTICS OF MONEY:
Durability :
Durability means that the money
must be able to withstand being
used repeatedly.

8. PORTABILITY:
• Portability means that individuals
are be able to carry money with the
and transfer it easily to other
individuals.

9. DIVISIBILITY:
• Divisibility means that the money can easily
be divided into smaller units of value.

10. UNIFORMITY:
• Uniformity means that all version of the same
denomination of currency must have the
purchasing power.
•As an example, a 2005 $2 bill will still buy $2
worth of goods or services today.

11. ACCEPTABILITY :
• Acceptability means that everyone must be
able to use the money for transactions.

12. The condition in
which resources
are primarily
devoted to specific
tasks.

13. Not only individuals specialize but also,

14. ADVANTAGES AND DISADVANTAGES OF
SPECIALISATION :
Increase in output and
productivity
ADVANTAGES DISADVANTAGES
Continuity of supply
Increase in Profit and reduced costs
Increased efficiency
Increase in export revenue
Globally competitive
Fashion change
There will be loss if demand decreases
Greater cost of training workers
Technological breakdown may reduce or stop the
production
Less flexible due to specializing only in specific task

15. The division of labor
occurs where
production is broken
down into many
separate tasks.
DIVISION OF LABOUR

16. PROS AND CONS OF DIVIDION OF LABOUR:
More goods and services can
be produced
Full use is made of
everyone’s ability
Time is saved
It allows the use of
Machinery
Work becomes boring
Workers may feel
alienated
Products are all the same
People become too
dependent on each other
Higher productivity May lose job if product is no
more demanded in market