Currency in the World – Money is the official medium of exchange that has been approved by the government and society. Of course, you also know that every country always has a different type of currency from one country to another.
It will be easier for you to know the type of currency for each country by looking at a list of currencies in the world. Well, this article will explain more about each type of eye that exists in the world.
Of course, for those of you who want to know more about the list of world currencies. You can really read reviews about it only in this article.
Definition of Money in General
In modern economics, money can be interpreted as something that is available and will generally be accepted as a method or means of payment in the process of purchasing goods or using a service and other valuable assets and can be used to process debt payments.
Some experts say the function of money is a means of delaying payments. From this explanation, it can be concluded that money is an object that can be generally accepted by society and is used to measure value, exchange and process payments and purchases of goods and services and can be used as a means of hoarding wealth.
Types of money can be distinguished based on the material it is made of, for example, such as banknotes and coins.
Definition of Currency
After previously we have discussed the meaning of money. Next, we will learn together about the meaning of currency.
Currency is a unit price agreed upon by the government and the people of a country. As previously explained, each country has a different currency.
Even so, there are some currencies that are the same between one country and another. For example, America, Ecuador, Cambodia, Panama and the British Indian Ocean Region all share the same type of currency.
Meanwhile, for an example of a different currency, the Indonesian currency, namely the Rupiah, will be different from the Japanese currency, namely Yen.
Original Function of Money
In general, money has a function as an intermediary in the process of exchanging goods for goods which is also one of the methods of intermediary barter methods in the trade process. However, in more detail the function of money is divided into two, namely the original function and the derivative function.
An object can become money when the object meets certain conditions. The first requirement is that the object must be generally accepted. In order to be recognized as a common medium of exchange, the object must have the highest value or at least be guaranteed by the government.
Materials that can be used as money must also be durable, the quality is more likely to be the same and not easy to do counterfeiting and can have an amount that can meet people’s needs.
In addition, money must also be easily carried anywhere, portable and easy to share without the need to reduce value and be able to have a stable value over time.
Then, the original function of money is as follows.
1. As a medium of exchange
The original function of the first money is as a medium of exchange which can facilitate the exchange process. The existence of money will make a person do not need to exchange goods for other goods or barter. This is because the existence of money is intended to replace the barter process.
2. As a Unit of Count
Money also has a function as a unit of account. This is because money can be used to show the value of various types of goods or services that are traded.
Money can also show the amount of wealth a person has and money can be used to calculate the size of a loan. Money can also be used to determine the price of goods and services. As a unit of account, money will have an important role in the exchange process so that it can run more smoothly.
3. As a Store of Value
Money can be used as a store of value. This is because money can be used for the process of transferring purchasing power from the present to the future. When a seller receives money for the process of selling goods or services, the seller can save the money he earns to buy goods or services in the future.
Derivative Functions of Money
Money does not only have original functions. But money also has a derivative function. Now for more details, here is the derivative function of money.
1. As a Wealth Transferring Tool
Someone who wants to move to another place can also transfer their wealth, such as land or house buildings, into money. This can be realized by selling the house or land that he owns.
In a new place, the party concerned can buy a house or land again with the money obtained from the process of selling previous assets such as houses or land. From this it can be concluded that money can be a means of transferring wealth.
2. As a driving force for economic activity
If the value of money continues to be stable for a long time, it will usually make people invest. With these investment activities, economic activity will also increase.
3. As a Legal Instrument of Payment
Human needs for goods and services will increasingly increase and vary. Where these needs can no longer be met by exchanging goods or bartering.
In order to facilitate the process of obtaining goods or services, humans need a means of payment that can be accepted by everyone. Therefore, money can be used as legal tender.
4. As a Debt Payment Instrument
Money can also be used as a measure of future payments.
5. As a means of hoarding wealth
Some people decide not to use their money only for consumption purposes. Where some of the money will be legalized or saved for future needs.
List of World Currencies
According to Euro Change, currently there are more than 100 currencies that have been recognized and are located in various parts of the world. Of these, there are around 66 countries that use the United States dollar as a medium of exchange.
The list of world currencies in general will provide information in the form of the name of the currency of a country along with its code. Now for more details, here is a list of world currencies.
List of World Currencies with the Highest Exchange Rates
As previously explained, each country has a different currency. The amount of the value of the currency used is also influenced by how strong the economic conditions are in that country. Until now there are about more than 100 coins recognized by the United Nations.
The US Dollar or USD currency is one type of currency that is widely used in global trade processes. This makes the USD a reference for measuring the high and low of the currency of each country.
Even so, the USD is not the highest currency in the world for now. There are several countries with abundant natural resources, such as oil and gas, which usually rank first.
So below are some lists of the highest currency values in the world quoted from various sources.
- Kuwaiti Dinar (KWD)
- Bahraini Dinar (BHD)
- Omani rial (OMR)
- Jordanian Dinar (JOD)
- Cayman Islands Dollar (KYD)
- Sterling Pounds (GBP)
- Swiss Franc (CHF)
- US Dollar (USD)
- Euros (EUR)
- Canadian Dollar (CAD)
Well , that’s some list of the highest value of money in the world. Thus the discussion about currencies in the world and also the function of money. Hopefully all the discussion above is useful for Sinaumed’s.
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Author: Hendrik Nuryanto
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