advantages and disadvantages of money

In the eastern third world country like ours, the worst cases of money laundering and frauds have been encountered by innocent citizens in previous few years. In money laundering, middleman/intermediaries would collect money from one source and transfer it to another source through Bitcoins. 10,000. Money is something which is generally accepted as a medium of exchange. The advantages or uses of money can be best understood by considering the system in which money is absent. Introduction: • Electronic wallet service which allows users to store, send and receive money using their mobile device under financial regulation is known as mobile money. More often, a great deal of money can change human behaviour. Advantages of Money Market Funds . A large amount can be carried conveniently in the pocket without anybody knowing it. Advantages and disadvantages of having a lot of money, on Advantages and disadvantages of having a lot of money. One of the advantages to using money as a motivational tool is that it is a universal reward. Firstly, in spite of increased affordability, due to interest, service fees and legal costs, borrowing money will ultimately cost you more than if you were to support your goals by yourself. The required rate of return is 10%. There is not a single shred of doubt that money plays the most vital role in the world we live in. Paper money has got several advantages and disadvantages. There is always a danger of its over-issue when the Government is in financial difficulties. Good things always come with drawbacks. One of the primary reasons for this disadvantage is the fact that there are contractors and special interests involved in the process when non-money aid is offered to a foreign government. First, let's consider the advantages of putting your money in a money market account. It is easily and quickly increased; the printing press is more expeditious than the mine, smelter, and mint. Such a situation arose in many European countries during and after World War I, and later more recently in China. Post Courtesy of APARIJITA SINHA. If a country uses paper money, it need not spend anything on the purchase of gold or minting coins. ADVERTISEMENTS: Read this article to learn about Advantages and Disadvantages of Money! The value of paper money can be kept stable by properly regulating its issue. 1. On the top of that, money often causes addiction to get more money. It may cause grave discontent among the masses. Some people say that money can make life easier and more comfortable. In a very small bulk, it can contain a very large value. Conclusion. You should spend about 40 minutes on this task. If a country uses paper money… The supporters of electronic money point out that one of the main advantages is that it would end fraud and black money. A money market account, or money market deposit account, is a government-insured … Being all the credit in computers and be able to follow each movement, it would be complicated that nobody could hide something from the public treasury. However, like every other thing, money has dark side as well. Space exploration allows us to prepare for potential hazards.The universe is a vast place where hidden dangers could be lurking almost anywhere. Too much of money reduces its value and causes inflation (i.e., rise in price level) and too little of money raises its value and results in deflation (i.e., fall in price level). Bitcoins are not regulated by any bank or even the state. To give an illustration of what I mean, let us look at the issue of unemployment. Well, for starters, there can be disadvantages to putting your money … Inflation distorts the pattern of distribution in favour of the rich ; thus, it makes the rich richer and the poor poorer. An individual with an abundance of money can enjoy a dignified social status. It is in the domestic interest to maintain those relationships because it keeps money flowing through the company. Its quantity can be increased or decreased at the will of the currency authority. 869 Words 4 Pages. And these are exactly the two quantities which the Mobile Wallet seeks to bring together i.e. That said, when both sides are taken into consideration I think it is pretty clear that the advantages outweigh the disadvantages and that anybody who is serious about growing wealth should consider buying shares whether that be individual company shares or shares of investment funds. It is economical, since it substitutes a less expensive material than metal for money and conserves the metal for the arts. They balance the risk of loses against aim of achieving higher returns. You can save from just £1 which will help you to build up a pot of savings for when you really need it. Advantages of paper currency are that it's easy to use and cheap to produce and can be created on demand. This happened in various countries in recent times: in Russia (1917), in Germany (1919), in China (1944), and so on. What is Mobile Money? Our mission is to provide an online platform to help students to discuss anything and everything about Economics. Advantages and Disadvantages of Pocket Money techievp. The advantages and disadvantages of money Everybody knows the value of money. Disadvantages are that it is fragile and its value is subject to inflation and changes in public confidence. Share Your PDF File A modern war cannot be prosecuted by taxes or loans alone. Balanced funds invest in a mix of equities and fixed-income securities. Currency notes, therefore, are the cheapest media of exchange. More often, a great deal of money can change human behaviour. On the top of that, money often causes addiction to get more money. Its balance of payments becomes unfavorable. © Copyright 2017-2020 - IELTS Adviser | All Rights Reserved. We must remember that by this means our Government has been able to spend hundreds of crores of rupees on various ambitious programmes of development. It possesses, in a very large measure, the quality of portability which a money material should have. Therefore, there is a greater transparency with bitcoins. Advantages & Disadvantages of E-Payment Learn More → E-money, or electronic money, is money that you exchange electronically, as opposed to actual currency notes or coins. He can lead a cosy life ensuring amenities. The loss which a country suffers from the wear and tear of metallic money is also avoided. The rate of exchange falls. Secondly, the affluent man can contribute to the society. But what about the cons? The advantages and disadvantages of a money market account are essential to review if you have at least $5,000 in savings that remains relatively untouched. It mentions Mobile Money advantages or benefits and Mobile Money disadvantages or drawbacks. Without money, we cannot go to the movies, theaters or other amusements places. The following advantages can be mentioned: Paper money practically costs nothing to the Govern­ment. Once this course is adopted, however, it gathers momentum and leads to further note-printing, and this goes on till the paper currency loses all value. The material on the Money to the Masses website, 80-20 Investor, Damien’s Money MOT, associated pages, channels, accounts and any other correspondence are for general information only and do not constitute investment, tax, legal or other form of advice. Advantages of Money Market Funds Parking Space. Paper money is absolutely elastic. All in all, everybody wants to money at any cost. In recent years in India there has been great inflation. Privacy Policy3. Thereby, a man can use unfair means to earn more money. ADVERTISEMENTS: 1. (viii) Fiscal advantages to the Government of the paper currency are undoubtedly very great, especially in times of national emergencies like a war. News editors decide what to broadcast on television and what to print, Universities should accept equal numbers of male and female students, Letter: You have bought a new mobile phone, Describe a special school or college event that you remember well, Describe a transportation problem in your city/town, Describe an occasion when you received a good service from a company/shop, Very nice letter I got what Iwant.Thanks for the help, Thx for the colored charts. In order to understand more about barter system lets look at some of the advantages and disadvantages of barter system – Fire may burn it; if the place is flooded, it is gone; it may also be eaten up by white ants. This website includes study notes, research papers, essays, articles and other allied information submitted by visitors like YOU. Advantage: Convenient to Use Demand for and Supply of Money – Discussed. Share Your PPT File. Read this article to learn about Advantages and Disadvantages of Money! Paper money is the most convenient form of money. He can create job opportunities by establishing industries. It is remarkable that Indian Government was able to control inflation, whereas even countries like the U.K. were unable to check it. Welcome to EconomicsDiscussion.net! The computation under NPV takes into account the discounted net cash flows of an investment in order to determine its viability. By trading with cryptocurrency you won’t be f… Way to obtain money could be increased or decreased in … An amiable person may turn into an unpleasant individual. With mountains of money, a man, thus, could be savior of hundreds of unemployed youths. Nothing is more powerful than money. save time while spending and managing money. In other words, you can park your money in these accounts if you’re still unsure where to put your investment. Even if you consider only our solar system, there are asteroid and comet threats which could devastate our planet if an impact were to occur. (c) The rise in prices also leads to a fall in the external value of the home currency. Even among the coins there are good and bad coins. But we cannot overlook the disadvantages of money: (i) Paper money is of no value outside the country of issue. Of course, for every disadvantage of saving money, there’s an advantage out there. Money in the form of currency notes can be cheaply remitted from one place to another in an insured cover. The advantages of the issue of government paper money are: 1. Sample Answer: Exploring space gives us an opportunity to locate these hazards in advance to prepare an encounter that could help to preserve our race.Then there are the interstellar items to consider. Great Place to Park Money . Money makes the easier and far cosy. Another key thing to remember, in our capitalist society, the amount of money determines the social status of an individual. Thereby, a man can use unfair means to earn more money. It is true that many cases of corruption occur using cash, as it is more difficult to control. Really, paper money, if it is issued and regulated carefully, is without any disadvantage. Think of a currency note of Rs. But others say that having a lot of money can bring some problems. That is why there are many advocates of ‘managed’ paper currency. The Advantages and Disadvantages of the Barter System Written by admin Tuesday, 23 July 2013 15:45 No Comments. An amiable person may turn into an unpleasant individual. 2. Money market funds are less risky if you compare them with stocks and bonds. All great things. 5,000 in cash, but not in notes. The big advantage to saving money is that you’re prepared when you need to spend it. Advantages of Money: Paper money has got several advantages and disadvantages. First of all, it makes someone’s life easier and comfortable as he can buy what make his life easy. What do you think are the advantages and disadvantages of having a lot of money? Just like Melanie, we believe that saving is important. We use cookies to ensure that we give you the best experience on our website. And so if you’d like to get started putting aside a little money each month, then why not take a look at our Virgin Money Double Take E-Saver. Money has overcome drawbacks of barter system. UK/US has been using Bitcoins as smoothly as Fiat Currencies. This is the dilemma of money, unfortunately. More home money will have to be paid to buy units of foreign currencies. Disadvantages of borrowing money. The whole public feels the pinch. You should not rely on this information to make (or refrain from making) any decisions. If you continue to use this site we will assume that you are happy with it. Find out more Disadvantages of Money … Let’s say that after your cheap fence falls down; you decide to spend the money to have it repaired properly. In fact, money was invented by the society to overcome these drawbacks. The advantages and disadvantages of shares are numerous. As a result, labourers and people with fixed incomes suffer greatly. Consider each key point and you’ll be able to determine if starting a savings account or continuing to maintain the one you have is the right decision for you. The pros, of course, include creating some financial security for yourself, having money put aside in case of an emergency, and if you have a savings account, having your funds easily accessible. Elastic supply: Paper money because elasticity is very helpful for government. Several advantages stem from abundance of money. In fact, if we have no money, we cannot buy goods, clothes and other necessaries we need. Money is something that can be used by all employees, and for many employees, money is an appreciated reward for service to the company. (a) Prices rise steeply. (ii) There is a possibility of the damage to paper. It refers to that system under which goods or services were exchanged directly with other goods and services and there was no medium of exchange which is the case in present times where the medium of exchange is money. Without it, we face multitudes of problems, while our life would be harmed with the pile of money. It is very risky to carry on one’s person Rs. However, like every other thing, money has dark side as well. If you don’t want to choose this type, and if you think that the disadvantages are weighing more, then you can think about getting a credit card where you can spend money until you reach your limit. Mobile Wallet - Advantages and Disadvantages ‘Time is Money.’ This is what Benjamin Franklin had said thus connecting these two quantities. Gold and silver coins are accepted even by foreigners, as they have got some intrinsic value. It is, therefore, a very suitable medium of exchange. When paper money is over-issued, there is inflation and prices rise. Currency notes, therefore, are the cheapest media of exchange. DISADVANTAGES OF BITCOINS High Price Advantages & Disadvantages of Money Market Accounts. Only when it is over-issued, it becomes a great danger and a curse. But currency notes are all exactly similar. Th… (b) The indirect result of the excessive rise in prices is a fall in exports and a rise in imports. Advantages And Disadvantages Of Money Laundering. Most of these funds follow a formula to split the money among the different types of investments. Share Your Word File However, having a pile of money causes some advantage and disadvantage, as it is a double-edge sword. All countries issue paper currency, and, in normal times, they do not suffer from it in any manner. It can make people boastful. August 2, 2018. Disclaimer Copyright, Share Your Knowledge (iii) A serious drawback in paper currency is the ease with which it can be issued. Paper money is of very great advantage to the banks. It can make people boastful. To understand how present value figures are important in capital budgeting, let us consider the following example – A company is looking to invest $100,000 in a project. An over-issue of notes, in other words ‘inflation’, brings many evils in its train. Give reasons for your answer and include any relevant examples from your own knowledge or experience. This leads to the export of gold from the country, which is not a desirable thing. A great disadvantage of money is that its value does not remain constant which creates instability in the economy. 3. If one is lucky to have it, he is lucky. People who want to start a business but don't have the financial resources to do so often approach banks to borrow money. The Advantages of Borrowing Money From Friends & Family Learn More → If you don't have access to an affordable traditional loan, borrowing money from friends or family can be a viable option. Thus paper money can better meet the requirements of trade and industry. The advantages and disadvantages of a savings account involve cash access, long-term capitalization, and safety. The temptation is too great to be resisted. They can keep their cash reserves against liabilities in this form, for currency notes are full legal tender. Know More – Advantages and Disadvantages of Life Insurance. It hits hard several important sections of the people like workers and fixed- encomiasts. A mobile wallet in simple terms is a system of making payments. However, the less convinced ones point out that those who really wanted to disappoint would eventually find electronic means to do so. The people might lose confidence in the currency and it might become useless. Before publishing your Articles on this site, please read the following pages: 1. Know More – Advantages and Disadvantages of Artificial Intelligence. The primary advantage of using NPV is that it considers the concept of the time value of money i.e a dollar today is worth more than a dollar tomorrow owing to its earning capacity. The following advantages can be mentioned: ADVERTISEMENTS: (i) Economical: Paper money practically costs nothing to the Govern­ment. Virgin Money view. Hence within limits the issue of paper money comes very handy to the government at the time of dire need. One essential quality in money is that it must be exactly of the same type. The abundance of money, thus, could be catalyst in performing many evil acts. It is decentralized and is an alternate mode of currency that moves away from the monopoly of conventional money. All governments have to resort to the printing press. The paper money has another advantage so it has uniform quality and the holder doesn’t bother for possession of new or old money. Overall Bitcoins may have many advantages and disadvantages but it is up to the people and society in which ways do they use it. Unlike the popular belief that the theft of physical assets is the most dangerous thing out there, you need to keep in mind that in the age of information, losing your personal info or revealing identity to an unknown third party online can be much more dangerous. Although there are many advantages to borrowing money for your business, there are other aspects to factor in as well. Content Guidelines 2. TOS4. Today’s low-interest rates aren’t going to help that money grow, so this option can preserve your access will helping you to earn a little on the side. These are some of the advantages and disadvantages of borrowing money of this type. 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