MONEY

What is the purpose of people work? A hunter has killed more animals, collected their skins, hoen, meat, and the others which is very useful to the human life. A good fisherman by his boat looks for fish inhis dialy activity. A worker who always works everyday without recognizing his fatigue.  They want to live, and protect their children, family or even themselves from the lack of their daily needs. Money is the first destination of them. Here money plays an important role in human life, it is basically as a medium of exchange an has a special purchasing power. People ‘s lifes in all days work to get a wage.

            In economic system, there are five important characteristics for an item to be used as money. It must be generally accepted as payment, durable, easy divisible, easy transported, an difficult to duplicate. While an item need not possess all the characteristic above, the more it has. But the better of it, money has a certain function. Here money can be classified as commodity means that money is a proposed system of currency whose unit would have a fluctuating gold value determined at regular internal on the basis of an official index of commodity price. While the fiat money is mostly still used in US. It is a paper currencey made legal tender by law or fiat (an order issued by legal authority), although it is not backed by gold or silver and not necessary redeemable in coin.

            Money is also technically backed by papers and coin,because those things have been universally regarded as a valueable national currency. The legal money has been issued by government and authorized by bank. So that value of money much always be controlled by the goverment to prevent from the inflation.