Thursday, March 27, 2014
Sunday, March 23, 2014
The Value of Money
The overall idea and purpose of money is to make trading goods and services easier and more efficient for everybody. People always have things or services that they want to sell and buy, but the idea of money carries a worth that is understood universally.
For example, let's say that you want to sell your car, but you also need to have your house painted. I want to buy your car, but I am a physician, not a painter. I can't paint your house like a professional, but I can provide someone with healthcare and they can pay me with money. Then, I can exchange you the money for your car and you can give the money to a professional painter to paint your house. In the end, everybody gets what they want or need based on bartering and understanding the set and told worth of the amount on the bill.
Many people cannot put an exact value on some items or services, that is when we have to figure out if its worth to the individual. While some people may be impressed by a particular piece of art, others may just see it as an ordinary canvas with water colors on it. There would not be a clear understanding of the worth of the piece of artwork. Money, however, has the same set worth to everyone and nobody can change the worth of a dollar bill once it has been printed.
The actual pieces of paper have no kind of actual, intrinsic value. All of the paper bills are made from the same paper and just stamped with different numbers and presidents on it. We were told by our government that one piece of paper is worth less or more than another bill. As long as we place belief and have an equal understanding of the overall value of the dollar bill, then the system will continue to work as a bartering system.
For example, let's say that you want to sell your car, but you also need to have your house painted. I want to buy your car, but I am a physician, not a painter. I can't paint your house like a professional, but I can provide someone with healthcare and they can pay me with money. Then, I can exchange you the money for your car and you can give the money to a professional painter to paint your house. In the end, everybody gets what they want or need based on bartering and understanding the set and told worth of the amount on the bill.
Many people cannot put an exact value on some items or services, that is when we have to figure out if its worth to the individual. While some people may be impressed by a particular piece of art, others may just see it as an ordinary canvas with water colors on it. There would not be a clear understanding of the worth of the piece of artwork. Money, however, has the same set worth to everyone and nobody can change the worth of a dollar bill once it has been printed.
The actual pieces of paper have no kind of actual, intrinsic value. All of the paper bills are made from the same paper and just stamped with different numbers and presidents on it. We were told by our government that one piece of paper is worth less or more than another bill. As long as we place belief and have an equal understanding of the overall value of the dollar bill, then the system will continue to work as a bartering system.
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