What is currency?

Currency is the means that people use to purchase and sell items. It is how you get paid and how you pay your bills. There have been many different types of currency over history and even now countries change their means of currency. The value of currency can be based on many things. It used to be backed behind gold but times have changed and the United States no longer uses this backing in most cases.

When was paper money invented?

There was an obvious downside to having to pay for all products with coinage. It could become a very hefty endeavor to keep that much coin on hand for large purchases. The banknote took care of this. The paper product was backed by the bank and was thus called a banknote. These new banknotes first made an appearance in China and were called jiaozi from Sachuan in the 10th century. It was a popular idea and helped lead to banking systems. The Netherlands were the next area of Europe to adopt the paper money idea and from there it began to sweep through the rest of the continent.

Can I use my country’s currency somewhere else?

Yes, thanks to the exchange you can trade in your country’s denomination for the equivalent of another country’s money. You may come out ahead if your dollar, etc. is worth more in their country than it is yours. Mexico is a great example of this.

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This entry was posted on Monday, May 5th, 2008 at 7:54 am and is filed under Financial Services. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.