B8C

RME
PROJECT WORK

Kyeremeh
Oppong
Michael

MONEY
In modern society money is really useful in
sustaining one’s life and acquiring needs and
wants .Let us delve deep into this concept.
What is money?
Money is a system of value that facilitates the exchange of goods in an economy. Using money
allows buyers and sellers to pay less in transaction cost.

How money works

How Money Works

Money is a liquid asset used to facilitate transactions of value. It is used as a medium of

exchange between individuals and entities. It's also a store of value and a unit of account that
can measure the value of other goods.

Prior to the invention of money, most economies relied on bartering, where individuals would
trade the goods they had directly for those that they needed. This raised the problem of the
double coincidence of wants: a transaction could only take place if both participants had
something that the other needed. Money eliminates this problem by acting as an intermediary
good.
The first known forms of money were agricultural commodities, such as grain or cattle. These
goods were in high demand and traders knew that they would be able to use or trade these
goods again in the future. Cocoa beans, cowrie shells, and agricultural tools have also served as
early forms of money.

As economies became more complex, money was standardized into currencies. This reduced
transaction costs by making it easier to measure and compare value. Also, the representations
of money became increasingly abstract, from precious metals and stamped coins to paper
notes, and, in the modern era, electronic records.

During World War II, cigarettes became a de facto currency for soldiers in prisoner-of-war
camps. The use of cigarettes as money made tobacco highly desirable, even among soldiers who
did not smoke.

GHANAIAN CURRENCY
The Ghanaian currency is known as Ghana Cedis

What Are the Properties of Money?

In order to be most useful, money should be fungible, durable, portable, recognizable, and
stable. These properties reduce the transaction cost of using money by making it easy to
exchange.
Money Should Be Fungible
The word fungible refers to a quality that allows one thing to be exchanged, substituted, or
returned for another thing, under the assumption of equivalent value. Thus, units of money
should be interchangeable with one another.

For example, metal coins should have a standard weight and purity. Commodity money should
be relatively uniform in quality. Trying to use a non-fungible good as money results in
transaction costs that involve individually evaluating each unit of the good before an exchange
can take place.

Money Should Be Durable

Money should be durable enough to retain its usefulness for many, future exchanges. A
perishable good or a good that degrades quickly due to various exchanges will be less useful for
future transactions. Trying to use a non-durable good as money conflicts with money's essential
future-oriented use and value.

Money Should Be Portable

Money should be easy to carry and divide so that a worthwhile quantity can be carried on one's
person or transported. For example, trying to use a good that's difficult or inconvenient to carry
as money could require physical transportation that results in transaction costs.

Money Should Be Recognizable

The authenticity and quantity of the good should be readily apparent to users so that they can
easily agree to the terms of an exchange. Using a non-recognizable good as money can result in
transaction costs relating to authenticating the goods and agreeing on the quantity needed for
an exchange.

Money's Supply Should Be Stable

The supply of the item used as money should be relatively constant over time to prevent
fluctuations in value. Using a non-stable good as money produces transaction costs due to the
risk that its value might rise or fall, because of scarcity or over-abundance, before the next
transaction.

Uses of Money
Money primarily functions as the good people use for exchanges of items of value. However, it
also has secondary functions that derive from its use as a medium of exchange.

Money As a Unit of Account

Due to money's use as a medium of exchange for buying and selling and as a value indicator for
all kinds of goods and services, money can be used as a unit of account.

That means money can keep track of changes in the value of items over time and multiple
transactions. People can use it to compare the values of various combinations or quantities of
different goods and services.

Money as a unit of account makes it possible to account for profits and losses, balance a
budget, and value the total assets of a company.

Money As a Store of Value

Money's usefulness as a medium of exchange in transactions is inherently future-oriented. As
such, it provides a means to store a monetary value for use in the future without having that
value deteriorate.

So, when people exchange items for money, that money retains a particular value that can be
used in other transactions. This ability to function as a store of value facilitates saving for the
future and engaging in transactions over long distances.

Money As a Standard of Deferred Payment

To the extent that money is accepted as a medium of exchange and serves as a useful store of
value, it can be used to transfer value over different time periods in the form of credits and
debts.

One person can borrow a quantity of money from someone else for an agreed-upon period of
time, and repay a different agreed-upon quantity of money at a future date.

Honest ways of acquiring money as taught by the three main

religions
Islam
• Hard work (Qur’an 53:-39-41)
• Collecting interest on loan (Q2:274- 276).The Quran tells Muslims that it is dishonest to
collect interest on loans; rather they must acquire money through honest trade.

• Gambling (Q5:90-91).The Quran tells Muslims that they must not gamble because Allah does
not approve of it.

• Money should not be acquired through begging unless very

necessary.

Christianity
• Hard work (Prov. 14: 23-24; Proverbs 6:6-8; Col. 3: 23-24;

Rom. 11: 12-13)

• Money should be acquired through good stewardship

(Parable of the Talent Matt. 25-14-30)

• Money should be acquired honestly but not from the

exploitation of the poor and the weak (Proverbs 22:22-23;

Proverbs 28:8) and gambling (Amos 4; Ex. 20: 17 and Lk. 12:15

Indigenous Religion
• Hard work

• Prudence: Akan Proverb - 'One cannot be feasting at the same

time become rich).

• Creativity brings wealth -- ‘Poverty causes one to think

creatively'

• Good stewardship “If one takes good care of another's

possession, one also gets possession”.

• Money must not be acquired dishonestly, for example

through robbery and the exploitation of the poor and the weak in society - If the wind try to
pick an object with speed, it leaves it behind.

Reasons for Acquiring Money honestly

• It is sin to dishonestly acquire money, e.g. from sakawa.

• It is not good to take something which does not belong to

you.

• Dishonest acquisition of money brings chaos to society.etc.

Develop habit of saving money for future use.

• Get a place you can safely save money (e.g. in a susu box)

• Decide an amount of money you can save either daily or

weekly from your pocket money.

• At the end of the term and with the help of your parents

count all your savings and open an account with a financial

institution to save the money.

• Start the daily or weekly saving again.

Appropriate ways of using money

• Helping the poor and the needy (Bible 1 Peter 4:10; Deut.

15:7- 11); Qur’anic teachings on zakat and sadaqa (Q2:215,

3:134; Q9:30; Q9:60 and 9:103).

• Earning money from unlawful sources (fraud, armed robbery;

sakawa –cyber fraud; embezzlement and corruption) are not

appropriate

• From Oral traditions, ‘The person who gives to the poor

receives a reward from God’.

consume digital content; evaluate the

quality and validity of information

• Taking care of the family (Quran 17:23-4; 46:15); (Bible Deut.

15: 7-11; 1 Timothy 5: 8); Oral traditions: 'If someone takes

care for you to grow teeth, you also must take care for the

one to lose the teeth' and 'the father is a shield for the

family.'

• Forcharitable work such as building of schools, hospitals,

mosques, palaces, etc.

Bad ways of using money

• Using money to exploit others

• Lavish spending of money

• Squandering money for heirs to pay off indebtedness

• Using money to make others suffer etc