Английский язык: Сборник текстов и упражнений. Бодргина Л.И - 82 стр.

      In a barter economy, the seller and the buyer each must want something the
other has to offer. Each person is simultaneously a seller and a buyer. In order to
see a film, you must hand over in exchange a good or service that the cinema
manager wants. There has to be a double coincidence of wants. You have to find a
cinema where the manager wants what you have to offer in exchange.
      Trading is very expensive in a barter economy. People must spend a lot of
time and effort finding others with whom they can make mutually satisfactory
swaps. Since time and effort are scarce resources, a barter economy is wasteful.
The use of money-any commodity generally accepted in payment for goods, ser-
vices, and debts-makes the trading process simpler and more efficient.
      Other Functions of Money.
      Money can also serve as a standard of value. Society considers it convenient
to use a monetary unit to determine relative costs of different goods and services.
In this function money appears as the unit of account, is the unit in which prices
are quoted and accounts are kept.
      In Russia prices are quoted in roubles; in Britain, in pounds sterling; in the
USA, in US dollars; in France, in French francs. It is usually convenient to use the
units in which the medium of exchange is measured as the unit of account as well.
However there are exceptions. During the rapid German inflation of 1922-1923
when prices in marks were changing very quickly, German shopkeepers found it
more convenient to use dollars as the unit of account. Prices were quoted in dollars
even though payment was made in marks, the German medium of exchange.
      The situation in Russia nowadays reminds of that of in Germany.
      Money is a store of value because it can be used to make purchases in the future.
      To be accepted in exchange, money has to be a store of value. Nobody
would accept money as payment for goods supplied today if the money was going
to be worthless when they tried to buy goods with it tomorrow. But money is nei-
ther the only nor necessarily the best store of value. Houses, stamp collections,
and interest-bearing bank accounts all serve as stores of value. Since money pays
no interest and its real purchasing power is eroded by inflation, there are almost
certainly better ways to store value.
      Finally, money serves as a standard of deferred payment or a unit of account
over time. When you borrow, the amount to be repaid next year is measured in
pounds sterling or in some other hard currency. Although convenient, this is not
an essential function of money. UK citizens can get bank loans specifying in dol-
lars the amount that must be repaid next year. Thus the key feature of money is
its use as a medium of exchange. For this, it must act as a store of value as well.
And it is usually, though not invariably, convenient to make money the unit of ac-
count and standard of deferred payment as well.
      Different Kinds of Money.
      In prisoner-of-war camps, cigarettes served as money. In the 19th century
money was mainly gold and silver coins. These are examples of commodity mon-
ey, ordinary goods with industrial uses (gold) and consumption uses (cigarettes),
which also serve as a medium of exchange. To use a commodity money, society
must either cut back on other uses of that commodity or devote scarce resources to
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