essay the value of money

Essays About Money: Top 5 Examples and 6 Prompts

With money comes great power; however, power must always come with responsibility. Discover thought-provoking essays about money in our guide.

Money is everywhere. We use it to eat, drink, clothe ourselves, and get shelter, among many other uses. Nowadays, it is an undisputed fact that “money makes the world go round.” The earliest known form of money dates back to around 5,000 years ago ; trade was previously carried out using a barter system. However, over the centuries, more and more nations began implementing a currency system, and money has become more critical.

In the contemporary world, it seems to be “all about money.” However, it is important not to lose sight of what is important; we must maintain good physical and mental health and healthy relationships with the people around us. Money is necessary; it is just not the only thing necessary. To start your essay, read these examples to write insightful essays about money.

5 Top Examples On Essay About Money

1. essay on money by prasanna, 2. how money changed human history by jacob wilkins, 3. capitalism: money that make money by ernestine montgomery, 4. is money the most important thing by seth higgins.

5. An Introduction to Saving Money by Jeremy Vohwinkle

Writing Prompts For Essays About Money

1. good uses for money, 2. the “dark side” of money, 3. money’s role in history, 4. morality vs. money, 5. can money buy happiness, 6. how to save money.

“Imagine the world without money. We will eventually come to a point where we will be asking questions like “what’s the point of life”. Hope and goals are some of the important things that will keep a man going in life. Without any sense of achievement or motivation, there wouldn’t be any inventions or progress in the world. People work to get money and then people work harder to get more money. This cycle of life that keeps a man motivated and hopeful is one of the biggest advantages of the system of money”

This essay gives readers a general outlook on money and its advantages and disadvantages. It gives people equal opportunity to work for their dreams and motivates them to be productive members of society, while it also raises the question of greed. Money, without a doubt, has its positive and negative aspects, but it exists and is only becoming more critical.

“But the barter economy was flawed. There was no universal measure for determining the value of an item. It was all based on the subjective opinion of the individuals involved. And to make matters worse, the barter economy relied on both sides wanting something the other had to offer. Trade, therefore, could be sluggish and frustrating. Human beings needed something different, and money was the answer.”

Wilkins writes about how money revolutionized the way trade was conducted. The barter system involved trading any objects if both parties agreed to a deal, such as trading animal skins for fish or medicine for timber. However, the only measure of an item’s value was how much one party wanted it- both sides needed to have something the other wanted. The introduction of money allowed people to put a solid value on commodities, making trade easier.

“So, if you were to closely observe the dirty, disordered canvas of economic progress during the 20th and 21 st century, you should conclude that, for all its warts, capitalism has been the winner. It has sometimes caused pain; suffered from serious cycles; and often needed the clout of the state- such as we have seen from September 2008. It has also been quite resistant to sensible regulation. Even so, the basic institutions of capitalism have worked, not just in the US and the OECD (Organization for Economic Co-operation and development) nations, but also many developing countries, of which India is one.”

Albeit lengthy, Montgomery’s essay discusses the debate between socialism and capitalism, a topic of which money is at the core. Montgomery describes Karl Marx’s criticism of capitalism: all the money goes to a few people, not the workers. She believes these are valid to an extent and criticizes certain forms of capitalism and socialism. Neither capitalism nor socialism is perfect, but according to Montgomery, capitalism creates a better economy.

“Being the richest man in the world does not mean you are the happiest man in the world, although money can buy you happiness sometimes, but not always. If we could all appreciate the way life is, the fun, and the beauty I think the world would be better. If people weren’t power hungry maybe we’d have a lesser demand for money. Those people who is money hungry and power hungry need to relax. Money can’t buy you happiness. These individuals need to understand that.”

Higgins implores readers to remember that money is not the only thing people need in the world. He stresses the necessity of money, as it is used to pay for various necessary goods and services; however, he believes it is not a prerequisite for happiness. Material things are temporary, and there are other things we should focus on, like family and friends.

5. An Introduction to Saving Money by Jeremy Vohwinkle

“A financial emergency may take the form of a job loss, significant medical or dental expense, unexpected home or auto repairs, a hurricane or major storm, or something unthinkable, such as a global pandemic. The last thing you want to do is to rely on credit cards with their hefty interest fees or to be forced to take out a loan. That’s where your emergency fund can come in handy. Historically, the formula for an emergency account is to have enough readily available cash to cover three to six months of living expenses.“

Vohwinkle’s essay gives readers some suggestions on how to save more money. Most importantly, he suggests setting up an emergency fund, as all other saving techniques stem from there. He also suggests creating an automatic savings plan and cutting down on “spending leaks,” like buying coffee. You might also be interested in these essays about celebration .

In this essay, write about why money is necessary and the ways to use it for the greater good, and include ways in which it can be used (investing, donating, etc.). For each point, you make, be sure to explain why. Of course, this is entirely subjective; feel free to write about what you consider “good uses” for money.

On the other hand, money also has a negative side —research on money-related issues, such as taxpayer-funded corruption and trading of illegal goods. In your essay, explore this side of money and perhaps give solutions on how to stop these problems.

Money has played a progressively more important role throughout human history. Discuss the development of currency and the economy, from the barter system to the digital world we live in today. You need not go too in-depth, as there is a lot of ground to cover and many eras to research. Be sure to cite reputable sources when discussing history.

Many people warn of “selling your soul” for financial gain. In your essay, you can write about the importance of having solid values in this day and age, where money reigns supreme. What principles do you need to keep in mind? Explain how you can still value money while staying grounded; mention the balance between material needs and others.

As stated in Higgins’ essay, more people have begun to prioritize money over all else. Do you believe that money is truly the most important thing? Can it alone make you happy? Discuss both sides of this question and choose your position accordingly. Be sure to provide precise supporting details for a stronger argument.

Enumerate tips on how you can save money. Anything works, from saving certain things for special occasions to buying more food in the grocery rather than eating out. This is your opinion; however, feel free to consult online sources and the people around you for extra advice.

For help with your essays, check out our round-up of the best essay checkers .If you’re still stuck, check out our general resource of essay writing topics .

Martin is an avid writer specializing in editing and proofreading. He also enjoys literary analysis and writing about food and travel.

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Essay On Money: 100, 250 Words Samples

Updated on
Nov 9, 2023

Why do you think money is important? Can we live without money? Does money have its own value? What’s the difference between hard money and digital money? When we plan on buying something, we have to pay a certain amount. Let’s say you want to buy a wristwatch worth $50. How do you compare that commodity with money? Do they have equal value? Is there any authority that states the value of money ? These and several other questions about money can make one wonder why money is given so much importance. Let’s go in-depth with an essay on money and find answers to all these questions.

Table of Contents

1 What is Money?
2 Why is Money So Important?
3 Essay on Money in 100 Words
4 Essay on Money in 250 Words

What is Money?

According to Wikipedia and Oxford Dictionary, Money is simply a medium of exchange. Some even consider money as one of the most important resources , which is used to make transactions of goods, services, or repayment of debts within a specific country or socio-economic context.

Money can have various forms, coins and banknotes in physical form, and electronic balances in bank accounts in digital forms. Money serves as a unit of account, facilitating the measurement of value in terms of prices, and as a store of value, allowing individuals to save purchasing power for future use.

Learn Why Financial Literacy is Important for Students.

Why is Money So Important?

What makes money such an important resource is its acceptance across the globe in multiple transactions and services. From serving as a medium of exchange to facilitating financial activities, the importance of money goes beyond our everyday needs. Here are several reasons stating the importance of money.

Money serves as a convenient medium of exchange that facilitates the buying and selling of goods and services, making transactions more efficient than barter systems.
It provides a standardized unit for measuring the value of goods, services, and assets, allowing for easier comparison and assessment of value across different items.
Money enables individuals and businesses to store wealth and purchasing power over time, facilitating savings and investment for future needs and goals.
A stable and reliable monetary system encourages investment, trade, and economic growth, fostering overall prosperity within an economy.
By using money, individuals and businesses can avoid the high transaction costs associated with bartering and the inefficiencies of non-monetary exchange systems.
The use of money encourages specialization in the production of goods and services, leading to increased productivity and efficiency within an economy.
Money is essential for the functioning of financial markets, banking systems, and investment activities, which are crucial for the allocation of resources and capital within an economy.

Essay on Money in 100 Words

El dinero or money is used as a medium of exchange, unit of account, and store of value. It facilitates trade, allowing for the smooth exchange of goods and services, while also enabling efficient allocation of resources and encouraging economic growth. As a unit of account, it provides a standardized measure of value, simplifying the comparison of different goods and assets.

Moreover, money acts as a store of value, allowing individuals to save and plan for the future. Its role in reducing transaction costs, enabling specialization, and supporting complex financial activities highlights its significance in the functioning of contemporary economies.

Essay on Money in 250 Words

Modern economics is heavily dependent on money or we can say that money is the pillar of modern economies. As a medium of exchange, it simplifies trade by providing a universally accepted method of payment for goods and services, eliminating the inefficiencies and limitations of barter systems. Its characteristic fosters the development of complex market systems, encouraging specialization and the efficient allocation of resources.

Apart from being a medium of exchange, money functions as a unit of account, providing a standardized measure of value that enables individuals to compare prices and evaluate the worth of different goods and services. This uniformity in valuation streamlines commercial activities and allows for effective planning and decision-making in both personal and business contexts.

Money serves as a store of value, allowing individuals to save and accumulate wealth over time. This feature empowers people to prepare for future expenses, emergencies, or long-term goals, providing a sense of security and stability in an uncertain world.

In addition to its role in daily transactions , money fuels economic growth by facilitating investment, entrepreneurship, and innovation. Financial institutions utilize money as a tool to allocate capital efficiently, enabling the development of new businesses, industries, and technologies that contribute to overall economic prosperity.

Money plays multiple roles in our lives; it is a physical or digital representation of currency; it is a fundamental pillar of modern economies, underpinning the intricate web of commercial activities, financial systems, and societal well-being. Its importance lies not only in its tangible properties but also in the complex functions and structures it supports within the global economic framework.

Money is globally accepted as a medium of exchange in multiple transactions and services. From serving as a medium of exchange to facilitating financial activities, the importance of money goes beyond our everyday needs. To buy goods or services, you are required to pay a certain amount, which is fulfilled by paying money.

To write an essay on money, you need to highlight the key aspects of this essential resource. The multiple transactions in which money is used in our day-to-day lives make money an important part of our lives. Give examples of how money can change our lives and what would happen if we were out of money. Highlight the latest trends in the financial sector and what governments are doing to save our money from inflation.

Here are the 5 strongest currencies in the world: Kuwait Dinar (KWD), Bahraini Dinar (BHD), Omani Rial (OMR), Jordanian Dinar (JOD), and Gibraltar Pound (GIP).

For more information on such interesting topics, visit our essay writing page and follow Leverage Edu .

Shiva Tyagi

With an experience of over a year, I've developed a passion for writing blogs on wide range of topics. I am mostly inspired from topics related to social and environmental fields, where you come up with a positive outcome.

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Essay on Money for Students and Children

500+ words essay on money.

Money is an essential need to survive in the world. In today’s world, almost everything is possible with money. Moreover, you can fulfill any of your dreams by spending money. As a result, people work hard to earn it. Our parents work hard to fulfill our dreams .

Furthermore various businessmen , entrepreneurs have startup businesses to earn profits. They have made use of their skills and intelligence in getting an upper hand in earning. Also, the employee sector works day and night to complete their tasks given to them. But still, there are many people who take shortcuts to success and get involved in corruption.

Black Money

Black money is the money that people earn with corruption . For your information corruption involves the misuse of the power of high posts. For instance, it involves taking bribes, extra money for free services, etc. Corruption is the main cause of the lack of proper growth of the country .

Moreover, money that people having authority earns misusing their powers is black money. Furthermore, these earnings do not have proper documentation. As a result, the people who earn this do not pay income tax . Which is a great offense and the person who does this can be behind bars.

Money Laundering

In simple terms, money laundering is converting black money into white money. Also, this is another illegal offense. Furthermore, money laundering also encourages various crimes. Because it is the only way criminal can use their money from illegal sources. Money laundering is a crime, and the people who practice it are liable to go to jail.

Therefore the Government is taking various preventive measures to abolish money laundering. The government is linking bank accounts to AADHAR Card. To get all the transaction detail of each bank account. As a result, the government comes to know if any transaction is from an illegal source .

Also, every bank account has its own KYC (Know your Customer) this separates different categories of income of people. Businessmen are in the high-risk category. Then comes the people who are on a high post they are in the medium-risk category. Further, the last category is of the Employee sector they are at the lowest risk.

Get the huge list of more than 500 Essay Topics and Ideas

White Money

White money is the money that people earn through legal sources. Moreover, it is the money on which the people have already paid the tax. The employee sector of any company always has white money income.

Because the tax is already levied on their income. Therefore the safest way to earn money is in the employment sector. But your income will be limited here. As a result, many people take a different path and choose entrepreneurship. This helps them in starting their own company and make profitable incomes .

Every person in this world works hard to earn money. People try different methods and set of skills to increase their incomes. But it is always not about earning money, it’s about saving and spending it. People should spend money wisely. Moreover, things should always be bought by judging their worth. Because money is not precious but the efforts you make for it are.

Q1. What is Black Money?

A1. Black money is the money that people earn through illegal ways. It is strictly prohibited in our country. And the people who have it can go to jail.

Q2. What is the difference between Black money and White money?

A2. The difference between black money and white money is, Black money comes from illegal earnings. But white money comes from legal sources with taxation levied on it.

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Essay on Importance of Money

Students are often asked to write an essay on Importance of Money in their schools and colleges. And if you’re also looking for the same, we have created 100-word, 250-word, and 500-word essays on the topic.

Let’s take a look…

100 Words Essay on Importance of Money

Introduction.

Money is a crucial part of our lives. It is the medium used for exchange of goods and services, and it helps us meet our basic needs.

Significance in Daily Life

Money allows us to acquire food, shelter, and clothing. Without money, survival would be difficult.

Role in Society

Money also plays a societal role. It helps us contribute to community development through taxes.

While money is important, it’s not everything. It’s a tool for survival and contribution, but happiness and fulfillment also require love, health, and peace.

Also check:

Speech on Importance of Money

250 Words Essay on Importance of Money

The significance of money.

Money, a medium of exchange, is a fundamental component of modern society. It is a tool that allows us to acquire goods, services, and experiences, thus playing a vital role in our lives.

Money as a Means of Exchange

Money simplifies trade, replacing the need for a direct barter system. It provides a standardized measure of value, enabling us to understand the worth of various commodities. This standardization facilitates smooth economic transactions and promotes economic efficiency.

Money and Freedom

Money also provides a certain level of freedom. It allows individuals to make choices about their lifestyle, from basic necessities to luxury items. It grants us the liberty to explore different opportunities, be it travel, education, or investment.

Money and Social Status

In many societies, money is often equated with power and status. While this perspective can lead to materialism and inequality, it also motivates individuals to strive for financial stability, fostering innovation and economic growth.

Money as a Tool, Not a Goal

However, it is crucial to remember that money is a means to an end, not an end in itself. The pursuit of money should not overshadow the importance of relationships, health, and personal fulfillment.

In conclusion, money holds significant importance in our lives. It is the cornerstone of economic activity, a catalyst for personal freedom, and a symbol of status. However, its value lies in its ability to enable us to achieve our goals, not in its mere accumulation.

500 Words Essay on Importance of Money

Money, often seen as a simple medium of exchange, plays a pivotal role in modern society. Its importance transcends mere transactions, permeating every aspect of our lives – from the economy to social structures, personal relationships, and even our sense of self-worth.

The Economic Imperative

At its most basic level, money is the lifeblood of any economy. It facilitates trade, allowing for the efficient exchange of goods and services. Without money, barter would be the only alternative – a system fraught with inefficiencies and limitations. Money, therefore, enables economic growth by allowing for specialization and the division of labor.

Money as a Social Construct

Beyond its economic function, money also plays a crucial role in society. It is a social construct that shapes and is shaped by our societal norms and values. Money can affect social dynamics, influencing relationships and power structures. It can serve as a tool for social mobility or conversely, a means of maintaining social stratification.

The Psychological Dimension

Money also has a profound psychological impact. It can influence our behavior, our motivations, and even our sense of self. Money can provide a sense of security and freedom, but it can also lead to stress and anxiety. The desire for money can motivate us to work harder and strive for success, but it can also lead to greed and materialism.

Money and Happiness

The relationship between money and happiness is a complex one. While money can provide for our basic needs and desires, research suggests that beyond a certain point, additional wealth does not lead to additional happiness. This suggests that while money is important, it is not the be-all and end-all of life.

In conclusion, the importance of money cannot be understated. It is a crucial component of our economy, a significant social construct, and a powerful psychological influence. However, it is also important to remember that money is a means to an end, not an end in itself. The pursuit of money should not overshadow the pursuit of happiness, fulfillment, and meaningful relationships. As society continues to evolve, so too will our understanding and use of money, necessitating an ongoing exploration of its role and importance in our lives.

That’s it! I hope the essay helped you.

If you’re looking for more, here are essays on other interesting topics:

Essay on Happiness Is More Important Than Money
Essay on Expensive Weddings Are a Waste of Money
Essay on Pocket Money Advantages and Disadvantages

Apart from these, you can look at all the essays by clicking here .

Happy studying!

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Is Money Really the Best Measure of Value?

If we want a more equitable world, then we need to consider the different ways people value money.

April 03, 2024

While some economic theories might assert that one dollar is in fact worth one dollar, Mohammad Akbarpour says this overlooks an important fact: Different people value money differently.

“How to allocate scarce resources and who should get what and why is the fundamental question of economic sciences,” says Akbarpour , who is an associate professor of economics at Stanford Graduate School of Business. In a free market, money plays a central role in answering that question, but as Akbarpour discusses in this episode of If/Then: Business, Leadership, Society , if we want a more equitable world, then we need to consider the different ways people value money.

Much of Akbarpour’s research has explored economic scenarios where wealth inequality presents an impediment to market maximization. One example is ride-sharing in Chicago, where Akbarpour identified systematic income disparities at play between an app’s riders and drivers, as well as among the riders themselves. Because riders in the city’s south side tend to be less affluent than those in the north, market-based pricing incentivizes drivers to concentrate in wealthy areas where riders can afford surge prices, leaving less affluent riders with less access to transportation.

Instead of allowing market forces to determine the cost of fares at a one-size-fits-all rate, Akbarpour argues for tailoring pricing based on income levels and people’s marginal value for money. “Once we believe in this one assumption and add it to the classic models, then we can ask the question of how to allocate scarce resources,” Akbarpour says. “If you care about the utility of these people too, then a policy that increases prices here and decreases prices there can start making sense.”

As Akbarpour explores in this episode of If/Then , creating a more equitable world requires that we challenge our prevailing assumptions about money and the value that people place on it.

Senior Editor, Stanford GSB

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If/Then is a podcast from Stanford Graduate School of Business that examines research findings that can help us navigate the complex issues we face in business, leadership, and society. Each episode features an interview with a Stanford GSB faculty member.

Full Transcript

Note: Transcripts are generated by machine and lightly edited by humans. They may contain errors.

Kevin Cool: If we want a more equitable world then we need to consider the different ways people value money.

Aziz: I like it because I can work whenever I like. I’m not a morning person. I used to be a cab driver for five years, and the car was sitting in the garage so I decided just to do Uber with my car. It’s just sitting there.

Kevin Cool: Meet Aziz. He’s an Uber driver in Chicago. Driving his red Toyota Yaris around the city most afternoons and evenings, and he’s been doing it a long time.

Aziz: I start 2013 so it’s almost 10 years.

Kevin Cool: Aziz has driven more than 20,000 Uber trips in those 10 years.

Aziz : So with Uber you just drive and more relaxing of driving. Not like that stress. Yeah, a lot of cab drivers, they were killed just for 50 bucks, but now, with Uber I don’t carry cash with me. It’s good. Yeah, it’s more safe, and you can drive whenever you are. If it’s busy in the summer I can stay in the summer. With Uber it’s more safe for me.

Kevin Cool: For Aziz, one of the biggest benefits of working for Uber is the control and choice he has. When he works, where he drives and which rides he accepts.

Aziz: So sometimes, I drive to Indiana or Michigan. I have no problems driving around. I drive south, north, west, northeast … the lake.

Kevin Cool: Aziz, like a number of the Uber drivers we met in Chicago, just wants to stay busy keeping the back seat of his car full of passengers for as much time as possible. The more rides with less down time affects what he takes home at the end of the day. Yet all the drivers we spoke to are very aware of the incentive prices for both drivers and passengers like surge pricing for different parts of the city.

Aziz: Now, I said it depends — what do you call it? When it’s busy, full charge, and if it’s not busy, they will get a price. You can make like between 20 bucks per hour until if it’s busy you can reach 30 or 35 per hour. So holidays like Thanksgiving we can do when it’s — only when the weather is bad like snowing it’s like people gave us work so you can make some extra money. It shows here like you are in the summer, and if it’s busy I stay there. Why I have to come to downtown because it’s busy in downtown or the surcharges? Sometimes, it’s like surcharge is very high in the south.

Kevin Cool: Price incentives determine where drivers like Aziz pick up rides, but if the only people who can afford those surge prices are in the wealthier parts of Chicago, is that fair for the people who need cars just as much in poorer neighborhoods on the South Side?

Higher prices are easier to stomach for people with lots of money, but what if these incentives could also help people who value money differently? It may sound simple, but it’s not something that conventional economics usually takes into account.

I’m Kevin Cool, Senior Editor at the GSB. Today, we explore the differences in how people value money and how those differences affect market dynamics with Mohammad Akbarpour, associate professor of Economics.

Mohammad Akbarpour: Really, one of the most fundamental questions of economics I try to answer in the project of economics is how to allocate scarce resources. If you read the classics like, “The Wealth of Nations,” the Karl Marx books from left and right this question of how to allocate the scarce resources, and who should get what, and why is a fundamental question of economic sciences.

And the most accepted, widely-recognized answer to this question is the market mechanism. It’s the free market. So if someone is willing to pay more than me for the good they have to get it. So let’s find the market-clearing price, the price at which the supply of something is equal to the demand and let the market work.

What we did in this paper was really to ask the very same question with one extra assumption. And the extra assumption was: different people have different marginal value for money. The whole idea of Econ 101 when you have supply curve, and demand curve, and the intersection of supply and demand curve will give you the market equilibrium, and that’s the point that the total value is maximized. That’s a picture that pretty much everyone who has taken one class in Economics has seen.

That idea that market equilibrium maximizes the total value, total surplus, or even total welfare comes from the belief that getting one dollar from me, and giving it to Elon Musk, is welfare-neutral. That one dollar has the same value for Elon Musk or Mohammad.

If we do not believe in this, which I do find an uncontroversial assumption, although we can talk about that like there is a fundamental philosophical critique to this assumption, if we believe that different people have different marginal values for cash then we should immediately believe that if you’re willing to pay more for something, that does not mean that the social welfare is maximized for giving a good to you. Because it could be that you are rich.

Once we believe in this one assumption and add it to the classic models, then we can ask the question of how to allocate the scarce resources in this way. And it turns out that with that one assumption, we can identify conditions under which free market remains efficient, and optimal, and fair, but that’s not always the case.

There would be many, many cases in which you want to start using non-market allocation mechanisms. And by non-market allocation mechanisms I mean things such as rationing, running a lottery, people waiting in the queue, and allocating the good for free like the allocation of vaccines.

Kevin Cool: So I want to ask you about a few examples in which this plays out, but the one I want to start with is Taylor Swift. I understand you just recently went to a Taylor Swift concert. Is that right?

Mohammad Akbarpour: Yeah, that’s right. I did not plan to, but I had a free ticket.

Kevin Cool: So you didn’t have to make the decision about how much it was, quote, unquote, worth, right? Yeah, but this does seem like a place where the free market failed or at least was flawed. There were some people who paid 70 times the face value. Seven-zero times the face value for a ticket. And, of course, legions of fans who were priced out and were angry about that. I know it’s just concert tickets, but what can we learn from these exorbitant prices and the calls for change that resulted?

Mohammad Akbarpour: Well, I should start by saying that this is really difficult problem. As we are sitting here multiple economists are thinking about the problem of ticket allocation because it’s a really difficult problem. So everything starts by this observation that if Taylor Swift concert tickets are allocated completely by some competitive equilibrium or free markets, then people who are going to be able to go to this concert are not necessarily people who love Taylor Swift the most.

This is again, should be uncontroversial. In fact, that’s the reason that Taylor Swift has started Very Fine Fans. And saying that if you are a Very Fine Fan now you can get the ticket before other people at lower prices. This is also the case for say, WorkUP. Whoever is happy to wake up at 5:00 a.m. and be the first person who signs in, in that website can get it.

FIFA for the World Cup decided that, “We are going to allocate tickets by lottery.” So everyone puts their name down for a hundred-dollar ticket, and then, “We are going to allocate it with lottery and 10 percent of people are going to get it.” These are all allocation mechanisms that Econ 101, the supply and demand curve, would tell you they are wrong. There is someone who was willing to pay more for this ticket, and you did not give the ticket to them.

And yet, policymakers do that, and in this paper, if you like, in this sequence of papers and research agenda that I started with my fantastic co-authors, Piotr Dworczak and Scott Kominers basically, our idea was people are doing it out there in the world. Some economists think that that is wrong. Could we actually make sense of this policy decision based on economic principles? Based on first principles.

And we could do that by just adding one feature to the model which is different people have different marginal value for money. So if someone is willing to pay $1,000 for a Taylor Swift concert they do not necessarily get more value from going to Taylor Swift concert than someone who is willing to pay $500.

Kevin Cool: Another example. A lot of the people who went to these concerts probably arrived in a Lyft or an Uber. And you’ve done some work looking at ride-sharing companies and how those mechanisms or how the market works in that. First of all, what is wrong with that market that needs to be fixed, and what would you propose as a remedy?

Mohammad Akbarpour: One thing that we discovered in the mathematics of the model was that there are two different types of inequality that can change the way you regulate a market. One type of inequality is the inequality across two sides of the market. In the Uber example that you just said or Lyft example, drivers are systematically poorer than riders.

That’s a fact that you can look at their tax returns. It’s clear that the typical Uber passenger is, on average, more well-off than a typical Uber driver. So that’s what we call the cross-saving equality. The other type of inequality is with inside inequality. Within riders. Some riders are rich, some riders are poor.

And these two different types of inequality give rise to two different policies or different types of policy outcomes. Within the framework of your question, drivers are systematically poorer than riders. And then, if you go to Chicago, riders of South Side Chicago are actually much poorer than riders of Lincoln Park, which is a much more well-off neighborhood.

And then when we take that observation that’s like basically, distribution of marginal values for cash which comes from the distribution of inequality into the model we will see that policies such as increased prices under Lincoln Park, because passengers are much less price-sensitive, and decreased prices on the South Side because passengers are very price-sensitive. And, in fact, you might even start getting negative revenue on the South Side. It doesn’t make sense for you to have business there. But if you have some redistributive goal, if you care about the utility of these people, too, then a policy that increases prices here and decreases prices here can start making sense.

Another policy that can start making sense is to detach the price of drivers and passengers. Instead of saying that the price is $100, and I’m going to get 40 percent of it as Uber as the platform you can set a higher price for riders, a lower price for drivers you will generate some revenue that is more than what you could do otherwise because now, you can charge riders much more. And then, you can use that revenue to give drivers benefits like such as health insurance and stuff like that as part of their compensation.

And I should emphasize, these are policies that are optimal if you are a social planner thinking about welfare, or a regulator who wants to actually maximize welfare. From an Uber perspective, if their only objective is revenue then it’s unclear that this is a good policy.

But I believe and working with different companies, I believe that even companies, even if it’s only about their own long term stock value, they do care about consumer welfare. They do care about actually creating a great PR, making sure that they are a company known as a good company. And in that case, if they want to help drivers this is the way they can do that.

Kevin Cool: You’re listening to “ If/Then ,” a podcast from Stanford Graduate School of Business. We’ll continue our conversation after the break.

[Music plays]

Kevin Cool: So you’re making an economic argument here, but it seems to me that it’s possible that someone would interpret this as a political argument. It’s redistributing money in a way from the rich to the poor. Have you had any pushback on that in that regard?

Mohammad Akbarpour: A lot of pushback. The very first few economists whom I really appreciate we talked about this idea, they were like very much against it because of several reasons. And let me actually get into some of the detail.

The first reason is what we are doing here is what a classic economist would call an interpersonal utility comparison, which means I’m saying that if I give one dollar to you versus one dollar to me this will generate more utility in your brain. This is going to give you more happiness than if I give it to Elon Musk.

I’m basically making a comparison of what happens in your brain. There is no reason to believe that actually, maybe Elon Musk is still as happier with getting one dollar than you. How do I know that? This is a really subtle philosophical critique. That’s why economists historically were really against interpersonal utility comparison. They were like, “The only thing we can observe is willingness to pay. How much you’re willing to pay for this tea. And if you are willing to pay more you probably enjoy it more.”

Kevin Cool: So the market is determining what happens?

Mohammad Akbarpour: Exactly.

Kevin Cool: Yeah, right.

Mohammad Akbarpour: So we are here in this paper, we are making these sequence of papers. We are making interpersonal utility comparisons. We are saying, “No, one dollar for an average American is more valuable than one dollar for Elon Musk,” and we are happy to take that stand.

The second critique, which is much more fundamental, is economists are actually not against redistribution. They believe — or at least some economists, I would call them market fundamentalists — they believe that the right way to do a distribution is through the tax system. It’s not through redistribution through markets that we do. It’s not distorting markets or that we suggest that it is sometimes optimal.

They say, “Let the markets work. If you want to actually have the poor tax the rich, and then redistribute using all kinds of redistributive policies from lump sum transfer, to free insurance, to free school.” All the social and welfare systems that we have in the United States and everywhere in the world.

What we’re doing in the very first part of our very first paper in this agenda is to actually debunk this by showing that if people have private information about how much they value something, if I know that the value of this concert ticket or value of this cancer treatment for me is a million dollars, but you don’t know that as the market-maker or as the regulator, then we show that actually, this result that the optimal path is to let the market work and redistribute. And we argue that this is a private information in pretty much any market. You really don’t know how much someone values a piece of vaccine, a dose of vaccine, or a cancer treatment, or a Taylor Swift concert.

Second argument is yes, it’s amazing if we could have an optimal tax system, but that’s really a political outcome. Can we really control the whole tax system? Like Democrats have an ideal tax point. Republicans have a different ideal tax point, and we can never be at the optimal tax system which makes distorting markets irrelevant.

So what we do here is to say, “Hey, we cannot change the tax system in short term or medium term, so let’s take that as given. And then given the tax system, how should we design a market? How should we allocate public housing? How should we allocate healthcare? How should we allocate even concert tickets?” And then, we can identify conditions under which market distortion makes sense.

Kevin Cool: Is one of the goals of your research to help solve inequality? And do you think more economists should be pursuing research with that goal in mind?

Mohammad Akbarpour: They say academia is the opposite of the military. Military people do what you tell them and academia people do not listen to anyone. So I cannot really tell what economists should work on. I think what we are doing is alleviating the problem of inequality. Solving the problem of inequality really comes at a macro level. That’s my view that you have to have the government and society who believes, “I don’t want to live in a society that’s extremely unequal.”

And then, the tax system, the welfare system is going to take care of that. So the reason that Scandinavia is a much more equal country than United States is not because of market distortions. It’s because the society as a whole and the government has decided, “We want to have a really, really progressive tax system.”

That doesn’t mean that Scandinavia is in a better situation than United States. That’s really a choice. A social choice of a society. Maybe in America we love to have a country that accepts some high-level of inequality in the name of innovation and growth. That’s a separate question.

So I think solving inequality comes at that level so what we’re doing in this paper is to take inequality as given, and then think about the question of, “How can you alleviate this problem that inequality exists through tools that you have in the market?” And it turns out that what we find is that for most of the day-to-day goods, for yogurt, for oat milk, for a car you actually don’t want to have market distortions.

The paper and this agenda mathematically we prove, and then we can look at data as well, that you want to start having market distortions for goods in which people do not have a huge valuation in their taste. So the social planner kind of knows, the regulator knows that the value of one dose of vaccine for different people with the same observables cannot be that massively different.

A better example is cancer treatment. If you and I both have some kind of cancer, probably both of us would like to get the best treatment equally. There is no reason for me to love my life significantly more than you. So if someone is willing to pay a million dollars for a cancer treatment and someone is willing to pay $10,000 for the cancer treatment I would argue most of the difference comes from the fact that the first one is much richer. It’s a budget constraint more than an actual value.

And the paper says for these types of goods, goods in which variation and willingness to pay can be mostly explained by variation in wealth. You want to have non-market mechanisms. So we are not solving the problem of inequality, but we are alleviating this problem for these types of goods that we refer to as essential goods.

Kevin Cool: Are you optimistic that policymakers, regulators could be persuaded that we have tools to make markets more fair or that that should happen?

Mohammad Akbarpour: I think it’s to some extent already happening in a lot of places. So one in every 10 almost houses in New York City are public houses. This is a redistributive program. Fifty percent of Amsterdam housing is public so we are already seeing this happening in practice.

What I’m optimistic we are going to do more and more with more data and more analysis is that policymakers and regulators start thinking about this problem more rigorously and identify the best policies instead of just some policy that we think might work.

Kevin Cool: What drew you to first of all, become an economist and to this research in particular?

Mohammad Akbarpour: The economics really came from the fact that I always loved mathematics, and I also loved looking at humans. Reading novels. Thinking about psychology. “Brothers Karamazov” was my favorite novel, and I realized that economics is somehow a great mix of thinking about humans and mathematics.

I came to Stanford University as a PhD student in the School of Engineering. And then, I got a few economics classes, and I fell in love with economics, and then I switched to economics. So that’s how it really all started for me thinking about economics.

This particular research I was uncomfortable by this assumption. From day one I saw it. This fact that the whole economics builds on the fact that moving one dollar from A to B or at least the whole Econ 101 is welfare-neutral. And coming from Iran I was kind of in the middle class myself, but I had a lot of family members in a really small city five hours away from the capital who are really, really poor.

And it was so clear that one dollar to them is significantly different than one dollar to people that I was surrounded with in Tehran in my university. So all of those really existed in my brain and I was uncomfortable with this question. And then, with my two fantastic co-authors they had different personal experiences and we were talking about these topics.

And we were like, “Do we want to commit the crime and do interpersonal utility comparison?” And we wrote the papers. I do remember that when I told this to one of my friends who is also an economist he was like, “I think with probability five percent this paper is going to start a whole new way of thinking. And with probability 95 percent people are going to laugh at you.” And I was like, “I will take that bet.”

Kevin Cool: You’ll take the five percent?

Mohammad Akbarpour: Yeah.

Kevin Cool: Yeah.

Mohammad Akbarpour: I will take the five percent. Life is too short to get the risk-less papers.

Kevin Cool: “ If/Then ” is produced by Jesse Baker and Eric Nuzum of Magnificent Noise for Stanford Graduate School of Business. Our show is produced by Jim Colgan and Julia Natt. Mixing and sound design by Kristin Mueller. From Stanford GSB, Jenny Luna, Sorel Husbands Denholtz, and Elizabeth Wyleczuk-Stern.

If you enjoyed this conversation we’d appreciate you sharing this with others who might be interested and hope you’ll try some of the other episodes in this series. For more on our professors and their research or to discover more podcasts coming out of Stanford GSB visit our website at gsb.stanford.edu. Find more on our YouTube channel. You can follow us on social media at StanfordGSB. I’m Kevin Cool.

For media inquiries, visit the Newsroom .

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Importance of Money Essay - 100, 200, 500 Words

Money is a commodity accepted by general consent as a medium of economic exchange. It is the principal measure of wealth. It is any good that is widely used and accepted in transactions. Human life will have a lot of changes with the presence and absence of money. Money has become the most vital part of life.

100 Words Essay On Importance Of Money

Money is a critical factor in our lives as it helps us to meet our basic needs and desires. It provides us with a sense of security and helps us to plan for the future. Money enables us to buy food, shelter, and clothing, and to access healthcare and education. Additionally, it provides us with the means to enjoy leisure activities and to travel. Money is also important in terms of personal and professional development, as it allows individuals to invest in themselves and their careers. Furthermore, money plays a crucial role in the economy, as it is used for transactions and for saving and investing.

200 Word Essay On Importance Of Money

The status of a person in society is impacted by how much money they have. We all desire financial success either b y working hard or succeeding in business. However, only a few people seize the opportunity to realise their dream of becoming a millionaire. Money also provides a measure of economic stability, as it allows for the management of inflation and the allocation of resources. On a personal level, money helps to meet basic needs and provide a sense of security, allowing individuals to plan for the future and pursue their goals and aspirations.

Everyone needs money, no matter how wealthy they are. Knowing the value of money in our lives helps us to avoid wasting or squandering it for any reason. The only reason for all the changes and variations in life is money. From the moment we begin till the moment we go to sleep, everything that happens in between requires the use of money. However, it is important to remember that money is not everything, and that true happiness and fulfillment come from other sources such as relationships, personal growth, and contributing to the community. Money is important, but it should not be the driving force in one's life.

500 Word Essay On Importance Of Money

Creation of money.

People bartered for goods and services before money was invented. About 5000 years ago, the Mesopotamian people created the shekel. This is considered the first known form of currency. Around 650 to 600 BC, gold & silver coins were stamped and used to pay armies. From then to now, money's importance has been increasing daily.

Origin of money

The word money is derived from the Latin word "Moneta" . Moneta means coin . In the ancient world, Juno was often associated with money.

Types of Money

There are seven types of money—representative, fair, paper, commodity, coinage, digital and commercial bank money . This money is used for exchange depending on their need and requirement.

Properties of money

The different properties of money are durability, divisibility, portability, uniformity, acceptability and limited supply. Having such unique and essential properties adds value to money.

Basic Need For Money

No matter their financial situation, everyone needs money. Money is required for many things, including purchasing clothing, housing, food, and other necessities. It's imperative to satisfy these needs. Our personal and societal well-being will suffer severely if we don't have enough money to achieve it.

Uses of money

In reality, we can say there are only five main uses for money

We can use it to live.

We can give it.

We can pay taxes.

We can repay debt and

We can save or grow it.

Power Of Money

Money has significant power to rule human life. It provides people with the ability to have the freedom to do what they want, be who they want and go where they want. Life with money will have success, freedom, choice, security, happiness and many more. Without money, we would be reduced to a barter economy. For every penny we spend in life, we need to think twice about whether it is worth it. Life without money shows us what adjustment is, what scarcity or starving for food is.

Impact Of Money

Money has a significant impact on our lives, influencing various aspects such as:

Basic necessities: Money allows us to meet our basic needs such as food, shelter, clothing, and healthcare.

Security: Having a stable source of income provides financial security, allowing us to plan for the future and reducing stress.

Career and personal development: Money provides the means for individuals to invest in themselves and their careers, allowing for personal growth and professional advancement.

Lifestyle: Money affects our lifestyle and the choices we make, from the type of home we live in to the leisure activities we pursue.

Relationships: Money can influence relationships, as disagreements over financial issues are common and can cause stress and tension.

Social status: Money affects social status, as income and wealth can determine access to certain opportunities and experiences.

Mental well-being: Money has a significant impact on mental health, as financial stress and insecurity can cause anxiety and depression.

In conclusion, money affects many aspects of our lives and has the potential to greatly impact our well-being, both positively and negatively. It is important to manage money wisely and to strive for financial stability while also balancing other important aspects of life.

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Entertainment
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Information Technology

Data Administrator

Database professionals use software to store and organise data such as financial information, and customer shipping records. Individuals who opt for a career as data administrators ensure that data is available for users and secured from unauthorised sales. DB administrators may work in various types of industries. It may involve computer systems design, service firms, insurance companies, banks and hospitals.

Bio Medical Engineer

The field of biomedical engineering opens up a universe of expert chances. An Individual in the biomedical engineering career path work in the field of engineering as well as medicine, in order to find out solutions to common problems of the two fields. The biomedical engineering job opportunities are to collaborate with doctors and researchers to develop medical systems, equipment, or devices that can solve clinical problems. Here we will be discussing jobs after biomedical engineering, how to get a job in biomedical engineering, biomedical engineering scope, and salary.

Ethical Hacker

A career as ethical hacker involves various challenges and provides lucrative opportunities in the digital era where every giant business and startup owns its cyberspace on the world wide web. Individuals in the ethical hacker career path try to find the vulnerabilities in the cyber system to get its authority. If he or she succeeds in it then he or she gets its illegal authority. Individuals in the ethical hacker career path then steal information or delete the file that could affect the business, functioning, or services of the organization.

GIS officer work on various GIS software to conduct a study and gather spatial and non-spatial information. GIS experts update the GIS data and maintain it. The databases include aerial or satellite imagery, latitudinal and longitudinal coordinates, and manually digitized images of maps. In a career as GIS expert, one is responsible for creating online and mobile maps.

Data Analyst

The invention of the database has given fresh breath to the people involved in the data analytics career path. Analysis refers to splitting up a whole into its individual components for individual analysis. Data analysis is a method through which raw data are processed and transformed into information that would be beneficial for user strategic thinking.

Data are collected and examined to respond to questions, evaluate hypotheses or contradict theories. It is a tool for analyzing, transforming, modeling, and arranging data with useful knowledge, to assist in decision-making and methods, encompassing various strategies, and is used in different fields of business, research, and social science.

Geothermal Engineer

Individuals who opt for a career as geothermal engineers are the professionals involved in the processing of geothermal energy. The responsibilities of geothermal engineers may vary depending on the workplace location. Those who work in fields design facilities to process and distribute geothermal energy. They oversee the functioning of machinery used in the field.

Database Architect

If you are intrigued by the programming world and are interested in developing communications networks then a career as database architect may be a good option for you. Data architect roles and responsibilities include building design models for data communication networks. Wide Area Networks (WANs), local area networks (LANs), and intranets are included in the database networks. It is expected that database architects will have in-depth knowledge of a company's business to develop a network to fulfil the requirements of the organisation. Stay tuned as we look at the larger picture and give you more information on what is db architecture, why you should pursue database architecture, what to expect from such a degree and what your job opportunities will be after graduation. Here, we will be discussing how to become a data architect. Students can visit NIT Trichy , IIT Kharagpur , JMI New Delhi .

Remote Sensing Technician

Individuals who opt for a career as a remote sensing technician possess unique personalities. Remote sensing analysts seem to be rational human beings, they are strong, independent, persistent, sincere, realistic and resourceful. Some of them are analytical as well, which means they are intelligent, introspective and inquisitive.

Remote sensing scientists use remote sensing technology to support scientists in fields such as community planning, flight planning or the management of natural resources. Analysing data collected from aircraft, satellites or ground-based platforms using statistical analysis software, image analysis software or Geographic Information Systems (GIS) is a significant part of their work. Do you want to learn how to become remote sensing technician? There's no need to be concerned; we've devised a simple remote sensing technician career path for you. Scroll through the pages and read.

Budget Analyst

Budget analysis, in a nutshell, entails thoroughly analyzing the details of a financial budget. The budget analysis aims to better understand and manage revenue. Budget analysts assist in the achievement of financial targets, the preservation of profitability, and the pursuit of long-term growth for a business. Budget analysts generally have a bachelor's degree in accounting, finance, economics, or a closely related field. Knowledge of Financial Management is of prime importance in this career.

Underwriter

An underwriter is a person who assesses and evaluates the risk of insurance in his or her field like mortgage, loan, health policy, investment, and so on and so forth. The underwriter career path does involve risks as analysing the risks means finding out if there is a way for the insurance underwriter jobs to recover the money from its clients. If the risk turns out to be too much for the company then in the future it is an underwriter who will be held accountable for it. Therefore, one must carry out his or her job with a lot of attention and diligence.

Finance Executive

Product manager.

A Product Manager is a professional responsible for product planning and marketing. He or she manages the product throughout the Product Life Cycle, gathering and prioritising the product. A product manager job description includes defining the product vision and working closely with team members of other departments to deliver winning products.

Operations Manager

Individuals in the operations manager jobs are responsible for ensuring the efficiency of each department to acquire its optimal goal. They plan the use of resources and distribution of materials. The operations manager's job description includes managing budgets, negotiating contracts, and performing administrative tasks.

Stock Analyst

Individuals who opt for a career as a stock analyst examine the company's investments makes decisions and keep track of financial securities. The nature of such investments will differ from one business to the next. Individuals in the stock analyst career use data mining to forecast a company's profits and revenues, advise clients on whether to buy or sell, participate in seminars, and discussing financial matters with executives and evaluate annual reports.

A Researcher is a professional who is responsible for collecting data and information by reviewing the literature and conducting experiments and surveys. He or she uses various methodological processes to provide accurate data and information that is utilised by academicians and other industry professionals. Here, we will discuss what is a researcher, the researcher's salary, types of researchers.

Welding Engineer

Welding Engineer Job Description: A Welding Engineer work involves managing welding projects and supervising welding teams. He or she is responsible for reviewing welding procedures, processes and documentation. A career as Welding Engineer involves conducting failure analyses and causes on welding issues.

Transportation Planner

A career as Transportation Planner requires technical application of science and technology in engineering, particularly the concepts, equipment and technologies involved in the production of products and services. In fields like land use, infrastructure review, ecological standards and street design, he or she considers issues of health, environment and performance. A Transportation Planner assigns resources for implementing and designing programmes. He or she is responsible for assessing needs, preparing plans and forecasts and compliance with regulations.

Environmental Engineer

Individuals who opt for a career as an environmental engineer are construction professionals who utilise the skills and knowledge of biology, soil science, chemistry and the concept of engineering to design and develop projects that serve as solutions to various environmental problems.

Safety Manager

A Safety Manager is a professional responsible for employee’s safety at work. He or she plans, implements and oversees the company’s employee safety. A Safety Manager ensures compliance and adherence to Occupational Health and Safety (OHS) guidelines.

Conservation Architect

A Conservation Architect is a professional responsible for conserving and restoring buildings or monuments having a historic value. He or she applies techniques to document and stabilise the object’s state without any further damage. A Conservation Architect restores the monuments and heritage buildings to bring them back to their original state.

Structural Engineer

A Structural Engineer designs buildings, bridges, and other related structures. He or she analyzes the structures and makes sure the structures are strong enough to be used by the people. A career as a Structural Engineer requires working in the construction process. It comes under the civil engineering discipline. A Structure Engineer creates structural models with the help of computer-aided design software.

Highway Engineer

Highway Engineer Job Description: A Highway Engineer is a civil engineer who specialises in planning and building thousands of miles of roads that support connectivity and allow transportation across the country. He or she ensures that traffic management schemes are effectively planned concerning economic sustainability and successful implementation.

Field Surveyor

Are you searching for a Field Surveyor Job Description? A Field Surveyor is a professional responsible for conducting field surveys for various places or geographical conditions. He or she collects the required data and information as per the instructions given by senior officials.

Orthotist and Prosthetist

Orthotists and Prosthetists are professionals who provide aid to patients with disabilities. They fix them to artificial limbs (prosthetics) and help them to regain stability. There are times when people lose their limbs in an accident. In some other occasions, they are born without a limb or orthopaedic impairment. Orthotists and prosthetists play a crucial role in their lives with fixing them to assistive devices and provide mobility.

Pathologist

A career in pathology in India is filled with several responsibilities as it is a medical branch and affects human lives. The demand for pathologists has been increasing over the past few years as people are getting more aware of different diseases. Not only that, but an increase in population and lifestyle changes have also contributed to the increase in a pathologist’s demand. The pathology careers provide an extremely huge number of opportunities and if you want to be a part of the medical field you can consider being a pathologist. If you want to know more about a career in pathology in India then continue reading this article.

Veterinary Doctor

Speech therapist, gynaecologist.

Gynaecology can be defined as the study of the female body. The job outlook for gynaecology is excellent since there is evergreen demand for one because of their responsibility of dealing with not only women’s health but also fertility and pregnancy issues. Although most women prefer to have a women obstetrician gynaecologist as their doctor, men also explore a career as a gynaecologist and there are ample amounts of male doctors in the field who are gynaecologists and aid women during delivery and childbirth.

Audiologist

The audiologist career involves audiology professionals who are responsible to treat hearing loss and proactively preventing the relevant damage. Individuals who opt for a career as an audiologist use various testing strategies with the aim to determine if someone has a normal sensitivity to sounds or not. After the identification of hearing loss, a hearing doctor is required to determine which sections of the hearing are affected, to what extent they are affected, and where the wound causing the hearing loss is found. As soon as the hearing loss is identified, the patients are provided with recommendations for interventions and rehabilitation such as hearing aids, cochlear implants, and appropriate medical referrals. While audiology is a branch of science that studies and researches hearing, balance, and related disorders.

An oncologist is a specialised doctor responsible for providing medical care to patients diagnosed with cancer. He or she uses several therapies to control the cancer and its effect on the human body such as chemotherapy, immunotherapy, radiation therapy and biopsy. An oncologist designs a treatment plan based on a pathology report after diagnosing the type of cancer and where it is spreading inside the body.

Are you searching for an ‘Anatomist job description’? An Anatomist is a research professional who applies the laws of biological science to determine the ability of bodies of various living organisms including animals and humans to regenerate the damaged or destroyed organs. If you want to know what does an anatomist do, then read the entire article, where we will answer all your questions.

For an individual who opts for a career as an actor, the primary responsibility is to completely speak to the character he or she is playing and to persuade the crowd that the character is genuine by connecting with them and bringing them into the story. This applies to significant roles and littler parts, as all roles join to make an effective creation. Here in this article, we will discuss how to become an actor in India, actor exams, actor salary in India, and actor jobs.

Individuals who opt for a career as acrobats create and direct original routines for themselves, in addition to developing interpretations of existing routines. The work of circus acrobats can be seen in a variety of performance settings, including circus, reality shows, sports events like the Olympics, movies and commercials. Individuals who opt for a career as acrobats must be prepared to face rejections and intermittent periods of work. The creativity of acrobats may extend to other aspects of the performance. For example, acrobats in the circus may work with gym trainers, celebrities or collaborate with other professionals to enhance such performance elements as costume and or maybe at the teaching end of the career.

Video Game Designer

Career as a video game designer is filled with excitement as well as responsibilities. A video game designer is someone who is involved in the process of creating a game from day one. He or she is responsible for fulfilling duties like designing the character of the game, the several levels involved, plot, art and similar other elements. Individuals who opt for a career as a video game designer may also write the codes for the game using different programming languages.

Depending on the video game designer job description and experience they may also have to lead a team and do the early testing of the game in order to suggest changes and find loopholes.

Radio Jockey

Radio Jockey is an exciting, promising career and a great challenge for music lovers. If you are really interested in a career as radio jockey, then it is very important for an RJ to have an automatic, fun, and friendly personality. If you want to get a job done in this field, a strong command of the language and a good voice are always good things. Apart from this, in order to be a good radio jockey, you will also listen to good radio jockeys so that you can understand their style and later make your own by practicing.

A career as radio jockey has a lot to offer to deserving candidates. If you want to know more about a career as radio jockey, and how to become a radio jockey then continue reading the article.

Choreographer

The word “choreography" actually comes from Greek words that mean “dance writing." Individuals who opt for a career as a choreographer create and direct original dances, in addition to developing interpretations of existing dances. A Choreographer dances and utilises his or her creativity in other aspects of dance performance. For example, he or she may work with the music director to select music or collaborate with other famous choreographers to enhance such performance elements as lighting, costume and set design.

Social Media Manager

A career as social media manager involves implementing the company’s or brand’s marketing plan across all social media channels. Social media managers help in building or improving a brand’s or a company’s website traffic, build brand awareness, create and implement marketing and brand strategy. Social media managers are key to important social communication as well.

Photographer

Photography is considered both a science and an art, an artistic means of expression in which the camera replaces the pen. In a career as a photographer, an individual is hired to capture the moments of public and private events, such as press conferences or weddings, or may also work inside a studio, where people go to get their picture clicked. Photography is divided into many streams each generating numerous career opportunities in photography. With the boom in advertising, media, and the fashion industry, photography has emerged as a lucrative and thrilling career option for many Indian youths.

An individual who is pursuing a career as a producer is responsible for managing the business aspects of production. They are involved in each aspect of production from its inception to deception. Famous movie producers review the script, recommend changes and visualise the story.

They are responsible for overseeing the finance involved in the project and distributing the film for broadcasting on various platforms. A career as a producer is quite fulfilling as well as exhaustive in terms of playing different roles in order for a production to be successful. Famous movie producers are responsible for hiring creative and technical personnel on contract basis.

Copy Writer

In a career as a copywriter, one has to consult with the client and understand the brief well. A career as a copywriter has a lot to offer to deserving candidates. Several new mediums of advertising are opening therefore making it a lucrative career choice. Students can pursue various copywriter courses such as Journalism , Advertising , Marketing Management . Here, we have discussed how to become a freelance copywriter, copywriter career path, how to become a copywriter in India, and copywriting career outlook.

In a career as a vlogger, one generally works for himself or herself. However, once an individual has gained viewership there are several brands and companies that approach them for paid collaboration. It is one of those fields where an individual can earn well while following his or her passion.

Ever since internet costs got reduced the viewership for these types of content has increased on a large scale. Therefore, a career as a vlogger has a lot to offer. If you want to know more about the Vlogger eligibility, roles and responsibilities then continue reading the article.

For publishing books, newspapers, magazines and digital material, editorial and commercial strategies are set by publishers. Individuals in publishing career paths make choices about the markets their businesses will reach and the type of content that their audience will be served. Individuals in book publisher careers collaborate with editorial staff, designers, authors, and freelance contributors who develop and manage the creation of content.

Careers in journalism are filled with excitement as well as responsibilities. One cannot afford to miss out on the details. As it is the small details that provide insights into a story. Depending on those insights a journalist goes about writing a news article. A journalism career can be stressful at times but if you are someone who is passionate about it then it is the right choice for you. If you want to know more about the media field and journalist career then continue reading this article.

Individuals in the editor career path is an unsung hero of the news industry who polishes the language of the news stories provided by stringers, reporters, copywriters and content writers and also news agencies. Individuals who opt for a career as an editor make it more persuasive, concise and clear for readers. In this article, we will discuss the details of the editor's career path such as how to become an editor in India, editor salary in India and editor skills and qualities.

Individuals who opt for a career as a reporter may often be at work on national holidays and festivities. He or she pitches various story ideas and covers news stories in risky situations. Students can pursue a BMC (Bachelor of Mass Communication) , B.M.M. (Bachelor of Mass Media) , or MAJMC (MA in Journalism and Mass Communication) to become a reporter. While we sit at home reporters travel to locations to collect information that carries a news value.

Corporate Executive

Are you searching for a Corporate Executive job description? A Corporate Executive role comes with administrative duties. He or she provides support to the leadership of the organisation. A Corporate Executive fulfils the business purpose and ensures its financial stability. In this article, we are going to discuss how to become corporate executive.

Multimedia Specialist

A multimedia specialist is a media professional who creates, audio, videos, graphic image files, computer animations for multimedia applications. He or she is responsible for planning, producing, and maintaining websites and applications.

Quality Controller

A quality controller plays a crucial role in an organisation. He or she is responsible for performing quality checks on manufactured products. He or she identifies the defects in a product and rejects the product.

A quality controller records detailed information about products with defects and sends it to the supervisor or plant manager to take necessary actions to improve the production process.

Production Manager

A QA Lead is in charge of the QA Team. The role of QA Lead comes with the responsibility of assessing services and products in order to determine that he or she meets the quality standards. He or she develops, implements and manages test plans.

Process Development Engineer

The Process Development Engineers design, implement, manufacture, mine, and other production systems using technical knowledge and expertise in the industry. They use computer modeling software to test technologies and machinery. An individual who is opting career as Process Development Engineer is responsible for developing cost-effective and efficient processes. They also monitor the production process and ensure it functions smoothly and efficiently.

AWS Solution Architect

An AWS Solution Architect is someone who specializes in developing and implementing cloud computing systems. He or she has a good understanding of the various aspects of cloud computing and can confidently deploy and manage their systems. He or she troubleshoots the issues and evaluates the risk from the third party.

Azure Administrator

An Azure Administrator is a professional responsible for implementing, monitoring, and maintaining Azure Solutions. He or she manages cloud infrastructure service instances and various cloud servers as well as sets up public and private cloud systems.

Computer Programmer

Careers in computer programming primarily refer to the systematic act of writing code and moreover include wider computer science areas. The word 'programmer' or 'coder' has entered into practice with the growing number of newly self-taught tech enthusiasts. Computer programming careers involve the use of designs created by software developers and engineers and transforming them into commands that can be implemented by computers. These commands result in regular usage of social media sites, word-processing applications and browsers.

Information Security Manager

Individuals in the information security manager career path involves in overseeing and controlling all aspects of computer security. The IT security manager job description includes planning and carrying out security measures to protect the business data and information from corruption, theft, unauthorised access, and deliberate attack

ITSM Manager

Automation test engineer.

An Automation Test Engineer job involves executing automated test scripts. He or she identifies the project’s problems and troubleshoots them. The role involves documenting the defect using management tools. He or she works with the application team in order to resolve any issues arising during the testing process.

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The Value Of Money Essay

Time and money are two essential resources in life. Many people do not care about time till they come nearly to the end, and others do just about the same with money. Some, who have more money than they know how to use them, actually abuse them. Some waste the time in making money; others waste money in no time. People need to understand both time and money and strike a balance between them. Focus on your inner stuff! Prosperity, synonym to money and materials, is chiefly a state of mind, just as scarcity is. It is rarely the actual amount of what you posses, but how you use it or appreciate it that makes the difference in prosperity. There is no way to prosperity – prosperity is the way. The true prosperity is not about money; it is about live, life and love. It is about health and well-being, about how you feel yourself. You are comfortable to face yourself every morning in the mirror than be rich and famous. The true rich are frugal – meaning they have high joy-to-stuff ratio. The less stuff you have, the more free you are to enjoy the life. Yet, people want to add more and more stuff to their possessions often to …show more content…

Is it capable of creating real happiness ? All over the world in all the developed countries, the graph of peoples’ earnings has ever been pointing upwards. In America inflation adjusted income has trebled since the end of the Second World War (May 8, 1945). Everybody seems to be lending his voice to the chorus in praise of the consumerist way. But while an attempt is made to chart the graph of human happiness of the people in the same country, it looks flat. It means that increase in the wealth did not have any commensurate effect on the happiness of the people. The researches which the social scientists have carried out in this area seem to confirm that while increase in wealth increases the material comforts of life, it does not increase proportionately the happiness of the

Theme Of Inequality In Of Mice And Men

The main factor of wealth that causes trouble is the inability to create a better life. Most want success

Analysis Of The Short Story Folding Beijing, By Hao Jingong

“Money can’t buy happiness.” “Money isn’t everything, its just paper.” Anyone who has ever grown up without money and lamented about it has heard these kinds of phrases many times. In looking around our culture and society today it would be hard to say those statements are true. While everyone has problems, rich and poor alike, having money gives you access to more solutions to those problems.

Grades And Money By David Vogel Analysis

We take care about our happiness is not only money. I think we need to use and study these two conceptions in our life. We live in material world where money exists. We need knowledge about it.

Similarities Between A Raisin In The Sun And The Great Gatsby

Wealth is an important aspect of life, well for most people, it can be interpreted into power, fame, and most importantly materialistic satisfaction. So, what is wealth in general? Wealth measures the estimation of the value of assets of worth claimed by a man, group, organization or nation. Wealth is dictated by taking the total market estimation of all physical and immaterial assets claimed, then subtracting all debts. A recent study by University professor had shown that the people who owns more money than others, will have a different viewpoint in society.

What Is The Sacrifice In The Great Gatsby

There can be no wealthy without the poor. Wealth is measured in material goods; he who has more is wealthier man. Often times, this material wealth will come to the expense of others. The material goods used by the wealthy need to come from somewhere. Many times, it is up to the poor to provide for the wealthy.

What Happiness Is Eduardo Porter Summary

What Happiness Is In the essay “What Happiness Is,” Eduardo Porter states that happiness is a slippery concept. He believes that happiness doesn’t have a specific definition, it means different things to each person. In the essay happiness is broken down into 3 parts: satisfaction, positive feelings, and the absence of negative feelings. Porter says that most people think that money and economic stability will bring them happiness and because of that they will push themselves to do better at their jobs.

Can Money Buy Happiness Rhetorical Analysis

One study revealed that money was an essential need for happiness, but it was not what made the people happy. They established satisfaction in close relationships with loved ones, community work, fulfillment and pride from their work and accomplishments (Diener and Biswas-Diener 162). The highest life satisfaction was found in societies of wealthy nation while the unhappiest nations were the extremely poor ones. When it comes to materialism, it does not matter if someone is rich or poor, all that matters is that “your income is sufficient to your desire,” and that “differences in aspirations lead to very different amounts of happiness” (Diener and Biswas-Diener 170).

Theme Of Wealth In Great Expectations

Happiness and Wealth: two words that are both alike and distinct. One without wealth can be happy, one with substantial wealth may not be happy, but one rarely has both. In Charles Dickens’ novel, Great Expectations, the main character, Pip, suddenly grows wealthy and rises in class; a common Victorian rags to riches story. However, as his capital increases, his character decreases by acting recklessly and being shameful of his modest upbringing. Additionally, Miss Havisham and her adopted daughter, Estella - born wealthy - are spoiled and don’t contribute anything beneficial to society.

Gregg Easterbrook The Real Truth About Money Rhetorical Analysis

Can money bring you happiness: many Americans believe that having lots of money can bring happiness? However one writer, Gregg Easterbrook, in his article, “The Real Truth about Money,” promotes that having a lot of money in your pocket doesn’t bring happiness in this world. He writes this article to persuade his audience that money doesn’t bring happiness. Easterbrook begins building his credibility with personal facts and reputable sources, citing convincing facts and statistics, and successfully employing Logical appeals; however, toward the end of the article, he attempts to appeal to readers’ emotions weaken his credibility and ultimately, his argument. In his article, Easterbrook starts his article by showing people how life has changed since the World War II and the Depression eras of life, and then he outlines that people that people spend lots of their time trying to keep up with the norms of life and draws the comparison that people who have higher income have depression or unhappy with themselves.

Can Money Buy Happiness?

Being rich leads to a stressful life but what doesn’t have problems and not being perfect is what makes us humans in this earth. There is a lot of debate on this matter that money could buy happiness, many people that agree to this lived on both sides for example a singer songwriter started from the bottom just making music but one day being notice and became wealthy. This outcome happens a lot in today’s time with the power of social media, but they could say their life got changed for the better they might be a few bumps in the road, but nothing can’t be fixed over time or putting in more money in which they have plenty of now. A TED talk video talk by Michael Norton, “how to buy happiness”, When people gain a big portion of money it makes everyone

Definition Of Wealth Essay

There are things money cannot buy that could consider being wealthy as long as I have my family, to be healthy, and to be happy. As life begins and love never ends, family is the number one aspect of being wealthy. I do not need a lot of money to have a rich life. Even though I may not have all the material things I ever wanted, my loving family are worth the load in gold.

Essay On Intrinsic Value

Definition: Intrinsic value is defined as a certain good that is worthwhile, not because it leads to the good of something else but for its own sake. The good in itself is recognised. Money for example can be a means to pleasure and some happiness but this is not evident in intrinsic value or good. Only states of consciousness can be intrinsically regarded as good. It also considers that certain beliefs or values are what they are.

To What Extent Can Money Buy Happiness Essay

Aside from using money for basic needs, money can also buy happiness by allowing one to buy time, live life to the fullest, and live freely without having to worries. First of all, money can buy you time, time is definite and stubborn, meaning that time time is constantly moving forwards and does not stop for anything. There is only so much of it, and no matter how long we complain about not having enough, it will never give us a 25 hour day even when we turn in our request for more time to finish a project before the deadline. According to an article in the Time magazine Dan Gilbert, Harvard University psychology professor said, “ Use your money to buy moments and not stuff, the key is to spend your money on experiences and not material things. Memories of people, places and activities, however, never get old.”

How Does Money Bring Happiness Essay

There is a very popular cliches that money cannot bring us happiness, however, new research of Cambridge shows that people who spent more money on purchases that matched their personality are happier. Money problem is an age-old question, there are many various thoughts of their believes, many people believe that money is the star of crime and the fade of true feelings. However,researchers show that people who has higher incomes is happier than people have lower incomes. Because money expands peoples’ choices of their future, and money changes their lives’ qualities to be more modern to bring them happiness. Therefore, people should build their lives to make more and more money to find more choices and more joyful life.

Roles Of Money In Macroeconomics Essay

ROLE OF MONEY IN MACROECONOMICS 1. Introduction Money can be seen as the medium of exchange which is acceptable while transaction is being undertaken between two parties. Some of the common forms of money are: - Commodity money: This is when the value of the good represents its value in terms of money like gold or silver. - Fiat money: This is when the value of the good is less than the value it represents - Bank money: It is the accounting credits that can be used by the depositor Money serves a variety of crucial functions in the economy and this is why it has gained an unparalleled influence in the matters of economy at micro as well as macro levels. Some of the features of money that make it so important for any economy are as follows:

More about The Value Of Money Essay

24.1 What Is Money?

Learning objectives.

Define money and discuss its three basic functions.
Distinguish between commodity money and fiat money, giving examples of each.
Define what is meant by the money supply and tell what is included in the Federal Reserve System’s two definitions of it (M1 and M2).

If cigarettes and mackerel can be used as money, then just what is money? Money is anything that serves as a medium of exchange. A medium of exchange is anything that is widely accepted as a means of payment. In Romania under Communist Party rule in the 1980s, for example, Kent cigarettes served as a medium of exchange; the fact that they could be exchanged for other goods and services made them money.

Money, ultimately, is defined by people and what they do. When people use something as a medium of exchange, it becomes money. If people were to begin accepting basketballs as payment for most goods and services, basketballs would be money. We will learn in this chapter that changes in the way people use money have created new types of money and changed the way money is measured in recent decades.

The Functions of Money

Money serves three basic functions. By definition, it is a medium of exchange. It also serves as a unit of account and as a store of value—as the “mack” did in Lompoc.

A Medium of Exchange

The exchange of goods and services in markets is among the most universal activities of human life. To facilitate these exchanges, people settle on something that will serve as a medium of exchange—they select something to be money.

We can understand the significance of a medium of exchange by considering its absence. Barter occurs when goods are exchanged directly for other goods. Because no one item serves as a medium of exchange in a barter economy, potential buyers must find things that individual sellers will accept. A buyer might find a seller who will trade a pair of shoes for two chickens. Another seller might be willing to provide a haircut in exchange for a garden hose. Suppose you were visiting a grocery store in a barter economy. You would need to load up a truckful of items the grocer might accept in exchange for groceries. That would be an uncertain affair; you could not know when you headed for the store which items the grocer might agree to trade. Indeed, the complexity—and cost—of a visit to a grocery store in a barter economy would be so great that there probably would not be any grocery stores! A moment’s contemplation of the difficulty of life in a barter economy will demonstrate why human societies invariably select something—sometimes more than one thing—to serve as a medium of exchange, just as prisoners in federal penitentiaries accepted mackerel.

A Unit of Account

Ask someone in the United States what he or she paid for something, and that person will respond by quoting a price stated in dollars: “I paid $75 for this radio,” or “I paid $15 for this pizza.” People do not say, “I paid five pizzas for this radio.” That statement might, of course, be literally true in the sense of the opportunity cost of the transaction, but we do not report prices that way for two reasons. One is that people do not arrive at places like Radio Shack with five pizzas and expect to purchase a radio. The other is that the information would not be very useful. Other people may not think of values in pizza terms, so they might not know what we meant. Instead, we report the value of things in terms of money.

Money serves as a unit of account , which is a consistent means of measuring the value of things. We use money in this fashion because it is also a medium of exchange. When we report the value of a good or service in units of money, we are reporting what another person is likely to have to pay to obtain that good or service.

A Store of Value

The third function of money is to serve as a store of value , that is, an item that holds value over time. Consider a $20 bill that you accidentally left in a coat pocket a year ago. When you find it, you will be pleased. That is because you know the bill still has value. Value has, in effect, been “stored” in that little piece of paper.

Money, of course, is not the only thing that stores value. Houses, office buildings, land, works of art, and many other commodities serve as a means of storing wealth and value. Money differs from these other stores of value by being readily exchangeable for other commodities. Its role as a medium of exchange makes it a convenient store of value.

Because money acts as a store of value, it can be used as a standard for future payments. When you borrow money, for example, you typically sign a contract pledging to make a series of future payments to settle the debt. These payments will be made using money, because money acts as a store of value.

Money is not a risk-free store of value, however. We saw in the chapter that introduced the concept of inflation that inflation reduces the value of money. In periods of rapid inflation, people may not want to rely on money as a store of value, and they may turn to commodities such as land or gold instead.

Types of Money

Although money can take an extraordinary variety of forms, there are really only two types of money: money that has intrinsic value and money that does not have intrinsic value.

Commodity money is money that has value apart from its use as money. Mackerel in federal prisons is an example of commodity money. Mackerel could be used to buy services from other prisoners; they could also be eaten.

Gold and silver are the most widely used forms of commodity money. Gold and silver can be used as jewelry and for some industrial and medicinal purposes, so they have value apart from their use as money. The first known use of gold and silver coins was in the Greek city-state of Lydia in the beginning of the seventh century B.C. The coins were fashioned from electrum, a natural mixture of gold and silver.

One disadvantage of commodity money is that its quantity can fluctuate erratically. Gold, for example, was one form of money in the United States in the 19th century. Gold discoveries in California and later in Alaska sent the quantity of money soaring. Some of this nation’s worst bouts of inflation were set off by increases in the quantity of gold in circulation during the 19th century. A much greater problem exists with commodity money that can be produced. In the southern part of colonial America, for example, tobacco served as money. There was a continuing problem of farmers increasing the quantity of money by growing more tobacco. The problem was sufficiently serious that vigilante squads were organized. They roamed the countryside burning tobacco fields in an effort to keep the quantity of tobacco, hence money, under control. (Remarkably, these squads sought to control the money supply by burning tobacco grown by other farmers.)

Another problem is that commodity money may vary in quality. Given that variability, there is a tendency for lower-quality commodities to drive higher-quality commodities out of circulation. Horses, for example, served as money in colonial New England. It was common for loan obligations to be stated in terms of a quantity of horses to be paid back. Given such obligations, there was a tendency to use lower-quality horses to pay back debts; higher-quality horses were kept out of circulation for other uses. Laws were passed forbidding the use of lame horses in the payment of debts. This is an example of Gresham’s law: the tendency for a lower-quality commodity (bad money) to drive a higher-quality commodity (good money) out of circulation. Unless a means can be found to control the quality of commodity money, the tendency for that quality to decline can threaten its acceptability as a medium of exchange.

But something need not have intrinsic value to serve as money. Fiat money is money that some authority, generally a government, has ordered to be accepted as a medium of exchange. The currency —paper money and coins—used in the United States today is fiat money; it has no value other than its use as money. You will notice that statement printed on each bill: “This note is legal tender for all debts, public and private.”

Checkable deposits , which are balances in checking accounts, and traveler’s checks are other forms of money that have no intrinsic value. They can be converted to currency, but generally they are not; they simply serve as a medium of exchange. If you want to buy something, you can often pay with a check or a debit card. A check is a written order to a bank to transfer ownership of a checkable deposit. A debit card is the electronic equivalent of a check. Suppose, for example, that you have $100 in your checking account and you write a check to your campus bookstore for $30 or instruct the clerk to swipe your debit card and “charge” it $30. In either case, $30 will be transferred from your checking account to the bookstore’s checking account. Notice that it is the checkable deposit, not the check or debit card, that is money . The check or debit card just tells a bank to transfer money, in this case checkable deposits, from one account to another.

What makes something money is really found in its acceptability, not in whether or not it has intrinsic value or whether or not a government has declared it as such. For example, fiat money tends to be accepted so long as too much of it is not printed too quickly. When that happens, as it did in Russia in the 1990s, people tend to look for other items to serve as money. In the case of Russia, the U.S. dollar became a popular form of money, even though the Russian government still declared the ruble to be its fiat money.

The term money , as used by economists and throughout this book, has the very specific definition given in the text. People can hold assets in a variety of forms, from works of art to stock certificates to currency or checking account balances. Even though individuals may be very wealthy, only when they are holding their assets in a form that serves as a medium of exchange do they, according to the precise meaning of the term, have “money.” To qualify as “money,” something must be widely accepted as a medium of exchange.

Measuring Money

The total quantity of money in the economy at any one time is called the money supply . Economists measure the money supply because it affects economic activity. What should be included in the money supply? We want to include as part of the money supply those things that serve as media of exchange. However, the items that provide this function have varied over time.

Before 1980, the basic money supply was measured as the sum of currency in circulation, traveler’s checks, and checkable deposits. Currency serves the medium-of-exchange function very nicely but denies people any interest earnings. (Checking accounts did not earn interest before 1980.)

Over the last few decades, especially as a result of high interest rates and high inflation in the late 1970s, people sought and found ways of holding their financial assets in ways that earn interest and that can easily be converted to money. For example, it is now possible to transfer money from your savings account to your checking account using an automated teller machine (ATM), and then to withdraw cash from your checking account. Thus, many types of savings accounts are easily converted into currency.

Economists refer to the ease with which an asset can be converted into currency as the asset’s liquidity . Currency itself is perfectly liquid; you can always change two $5 bills for a $10 bill. Checkable deposits are almost perfectly liquid; you can easily cash a check or visit an ATM. An office building, however, is highly illiquid. It can be converted to money only by selling it, a time-consuming and costly process.

As financial assets other than checkable deposits have become more liquid, economists have had to develop broader measures of money that would correspond to economic activity. In the United States, the final arbiter of what is and what is not measured as money is the Federal Reserve System. Because it is difficult to determine what (and what not) to measure as money, the Fed reports several different measures of money, including M1 and M2.

M1 is the narrowest of the Fed’s money supply definitions. It includes currency in circulation, checkable deposits, and traveler’s checks. M2 is a broader measure of the money supply than M1. It includes M1 and other deposits such as small savings accounts (less than $100,000), as well as accounts such as money market mutual funds (MMMFs) that place limits on the number or the amounts of the checks that can be written in a certain period.

M2 is sometimes called the broadly defined money supply, while M1 is the narrowly defined money supply. The assets in M1 may be regarded as perfectly liquid; the assets in M2 are highly liquid, but somewhat less liquid than the assets in M1. Even broader measures of the money supply include large time-deposits, money market mutual funds held by institutions, and other assets that are somewhat less liquid than those in M2. Figure 24.1 “The Two Ms: October 2010” shows the composition of M1 and M2 in October 2010.

Figure 24.1 The Two Ms: October 2010

The Two Ms; October 2010. M1, the narrowest definition of the money supply, includes assets that are perfectly liquid. M2 provides a broader measure of the money supply and includes somewhat less liquid assets. Amounts represent money supply data in billions of dollars for October 2010, seasonally adjusted.

M1, the narrowest definition of the money supply, includes assets that are perfectly liquid. M2 provides a broader measure of the money supply and includes somewhat less liquid assets. Amounts represent money supply data in billions of dollars for October 2010, seasonally adjusted.

Source : Federal Reserve Statistical Release H.6, Tables 3 and 4 (December 2, 2010). Amounts are in billions of dollars for October 2010, seasonally adjusted.

Credit cards are not money. A credit card identifies you as a person who has a special arrangement with the card issuer in which the issuer will lend you money and transfer the proceeds to another party whenever you want. Thus, if you present a MasterCard to a jeweler as payment for a $500 ring, the firm that issued you the card will lend you the $500 and send that money, less a service charge, to the jeweler. You, of course, will be required to repay the loan later. But a card that says you have such a relationship is not money, just as your debit card is not money.

With all the operational definitions of money available, which one should we use? Economists generally answer that question by asking another: Which measure of money is most closely related to real GDP and the price level? As that changes, so must the definition of money.

In 1980, the Fed decided that changes in the ways people were managing their money made M1 useless for policy choices. Indeed, the Fed now pays little attention to M2 either. It has largely given up tracking a particular measure of the money supply. The choice of what to measure as money remains the subject of continuing research and considerable debate.

Key Takeaways

Money is anything that serves as a medium of exchange. Other functions of money are to serve as a unit of account and as a store of value.
Money may or may not have intrinsic value. Commodity money has intrinsic value because it has other uses besides being a medium of exchange. Fiat money serves only as a medium of exchange, because its use as such is authorized by the government; it has no intrinsic value.
The Fed reports several different measures of money, including M1 and M2.

Which of the following are money in the United States today and which are not? Explain your reasoning in terms of the functions of money.

A Van Gogh painting

Case in Point: Fiat-less Money

Figure 24.2

Michael Mandiberg – 1 million iraqi dinar – CC BY-SA 2.0.

“We don’t have a currency of our own,” proclaimed Nerchivan Barzani, the Kurdish regional government’s prime minister in a news interview in 2003. But, even without official recognition by the government, the so-called “Swiss” dinar certainly seemed to function as a fiat money. Here is how the Kurdish area of northern Iraq, during the period between the Gulf War in 1991 and the fall of Saddam Hussein in 2003, came to have its own currency, despite the pronouncement of its prime minister to the contrary.

After the Gulf War, the northern, mostly Kurdish area of Iraq was separated from the rest of Iraq though the enforcement of the no-fly-zone. Because of United Nations sanctions that barred the Saddam Hussein regime in the south from continuing to import currency from Switzerland, the central bank of Iraq announced it would replace the “Swiss” dinars, so named because they had been printed in Switzerland, with locally printed currency, which became known as “Saddam” dinars. Iraqi citizens in southern Iraq were given three weeks to exchange their old dinars for the new ones. In the northern part of Iraq, citizens could not exchange their notes and so they simply continued to use the old ones.

And so it was that the “Swiss” dinar for a period of about 10 years, even without government backing or any law establishing it as legal tender, served as northern Iraq’s fiat money. Economists use the word “ fiat ,” which in Latin means “let it be done,” to describe money that has no intrinsic value. Such forms of money usually get their value because a government or authority has declared them to be legal tender, but, as this story shows, it does not really require much “fiat” for a convenient, in-and-of-itself worthless, medium of exchange to evolve.

What happened to both the “Swiss” and “Saddam” dinars? After the Coalition Provisional Authority (CPA) assumed control of all of Iraq, Paul Bremer, then head of the CPA, announced that a new Iraqi dinar would be exchanged for both of the existing currencies over a three-month period ending in January 2004 at a rate that implied that one “Swiss” dinar was valued at 150 “Saddam” dinars. Because Saddam Hussein’s regime had printed many more “Saddam” dinars over the 10-year period, while no “Swiss” dinars had been printed, and because the cheap printing of the “Saddam” dinars made them easy to counterfeit, over the decade the “Swiss” dinars became relatively more valuable and the exchange rate that Bremer offered about equalized the purchasing power of the two currencies. For example, it took about 133 times as many “Saddam” dinars as “Swiss” dinars to buy a man’s suit in Iraq at the time. The new notes, sometimes called “Bremer” dinars, were printed in Britain and elsewhere and flown into Iraq on 22 flights using Boeing 747s and other large aircraft. In both the northern and southern parts of Iraq, citizens turned in their old dinars for the new ones, suggesting at least more confidence at that moment in the “Bremer” dinar than in either the “Saddam” or “Swiss” dinars.

Sources : Mervyn A. King, “The Institutions of Monetary Policy” (lecture, American Economics Association Annual Meeting, San Diego, January 4, 2004), available at http://www.bankofengland.co.uk/speeches/speech208.pdf . Hal R. Varian, “Paper Currency Can Have Value without Government Backing, but Such Backing Adds Substantially to Its Value,” New York Times , January 15, 2004, p. C2.

Answer to Try It! Problem

Gold is not money because it is not used as a medium of exchange. In addition, it does not serve as a unit of account. It may, however, serve as a store of value.
A Van Gogh painting is not money. It serves as a store of value. It is highly illiquid but could eventually be converted to money. It is neither a medium of exchange nor a unit of account.
A dime is money and serves all three functions of money. It is, of course, perfectly liquid.

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Money: Short Essay on Value of Money

Category: Essays and Paragraphs On November 27, 2018 By Janhavi

Value of Money

The Value of Money has always played a key role in the human world. Money has changed it faces, changed its shape and size, changed its colour and usage, but the Value and Central Role of Money has always stayed the same.

Money is the means or the currency used for exchange of goods, or for the purpose of business or for the purpose of trade and commerce or for the purpose of valuing a particular goods or service. All these exchanges and valuations are central to our everyday existence and hence the Value of Money is also central to our everyday existence.

Applications of the Value of Money in daily life: We receive Money or earn Money by engaging in a particular profession, career or business. We get paid for the work that we do. This can be physical or intellectual work. The Value of our Work is evaluated by the Value of the Money that we receive for it. We spend this money to buy Services and Goods that we need for our daily life. These include a house, a car, clothes, food, drinks, water, electricity, household goods, household electronics like TV, Refrigerator, etc. These also include services like food delivery, barber shop, legal services, medical consultation, etc. All of these we buy with the Value of the Money we have. All of these have a Value tag attached to them, and if we have that Money we can buy them, otherwise not. So what we can afford and how we live our daily life directly depends on the Value of the Money we have. To increase the level of our lifestyle we need to increase the Value of the Money we possess. The entire human race spends most of its lifespan on increasing and accumulating more Money so that the Value it can add to one’s life increases.

Dimensions of the Value of Money: There are Material, Emotional and Spiritual dimensions to the real Value of Money in our lives. The material dimension determines how many material possessions we can have. The emotional dimension determines the dreams we associate with our Money. The Spiritual dimension determines the satisfaction we derive from our Money.

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Guest Essay

The Nobel Winner Who Liked to Collaborate With His Adversaries

A colorful illustration of two identical-looking youths in a bucolic setting. One is in red overalls and is before a red lawnmower, and the other is in blue overalls and is before a blue lawnmower. They are glaring at each other, and each has a foot pressed against the other’s. The two lawnmowers have carved a circle in the grass.

By Cass R. Sunstein

Mr. Sunstein is a law professor at Harvard and an author of “Noise,” with Daniel Kahneman and Olivier Sibony.

Our all-American belief that money really does buy happiness is roughly correct for about 85 percent of us. We know this thanks to the latest and perhaps final work of Daniel Kahneman, the Nobel Prize winner who insisted on the value of working with those with whom we disagree.

Professor Kahneman, who died last week at the age of 90, is best known for his pathbreaking explorations of human judgment and decision making and of how people deviate from perfect rationality. He should also be remembered for a living and working philosophy that has never been more relevant: his enthusiasm for collaborating with his intellectual adversaries. This enthusiasm was deeply personal. He experienced real joy working with others to discover the truth, even if he learned that he was wrong (something that often delighted him).

Back to that finding, published last year , that for a strong majority of us, more is better when it comes to money. In 2010, Professor Kahneman and the Princeton economist Angus Deaton (also a Nobel Prize winner) published a highly influential essay that found that, on average, higher-income groups show higher levels of happiness — but only to a point. Beyond a threshold at or below $90,000, Professor Kahneman and Professor Deaton found, there is no further progress in average happiness as income increases.

Eleven years later, Matthew Killingsworth, a senior fellow at the Wharton School of the University of Pennsylvania, found exactly the opposite : People with higher income reported higher levels of average happiness. Period. The more money people have, the happier they are likely to be.

What gives? You could imagine some furious exchange in which Professor Kahneman and Professor Deaton made sharp objections to Dr. Killingsworth’s paper, to which Dr. Killingsworth answered equally sharply, leaving readers confused and exhausted.

Professor Kahneman saw such a dynamic as “angry science,” which he described as a “nasty world of critiques, replies and rejoinders” and “as a contest, where the aim is to embarrass.” As Professor Kahneman put it, those who live in that nasty world offer “a summary caricature of the target position, refute the weakest argument in that caricature and declare the total destruction of the adversary’s position.” In his account, angry science is “a demeaning experience.” That dynamic might sound familiar, particularly in our politics.

Instead, Professor Kahneman favored an alternative that he termed “adversarial collaboration.” When people who disagree work together to test a hypothesis, they are involved in a common endeavor. They are trying not to win but to figure out what’s true. They might even become friends.

In that spirit, Professor Kahneman, well into his 80s, asked Dr. Killingsworth to collaborate, with the help of a friendly arbiter, Prof. Barbara Mellers, an influential and widely admired psychologist. Their task was to look closely at Dr. Killingsworth’s data to see whether he had analyzed it properly and to understand what, if anything, had been missed by Professor Kahneman and Professor Deaton.

Their central conclusion was simple. Dr. Killingsworth missed a threshold effect in his data that affected only one group: the least happy 15 percent. For these largely unhappy people, average happiness does grow with rising income, up to a level of around $100,000, but it stops growing after that. For a majority of us, by contrast, average happiness keeps growing with increases in income.

Both sides were partly right and partly wrong. Their adversarial collaboration showed that the real story is more interesting and more complicated than anyone saw individually.

Professor Kahneman engaged in a number of adversarial collaborations, with varying degrees of success. His first (and funniest) try was with his wife, the distinguished psychologist Anne Treisman. Their disagreement never did get resolved. (Dr. Treisman died in 2018.) Both of them were able to explain away the results of their experiments — a tribute to what he called “the stubborn persistence of challenged beliefs.” Still, adversarial collaborations sometimes produce both agreement and truth, and he said that “a common feature of all my experiences has been that the adversaries ended up on friendlier terms than they started.”

Professor Kahneman meant both to encourage better science and to strengthen the better angels of our nature. In academic life, adversarial collaborations hold great value . We could easily imagine a situation in which adversaries routinely collaborated to see if they could resolve disputes about the health effects of air pollutants, the consequences of increases in the minimum wage, the harms of climate change or the deterrent effects of the death penalty.

And the idea can be understood more broadly. In fact, the U.S. Constitution should be seen as an effort to create the conditions for adversarial collaboration. Before the founding, it was often thought that republics could work only if people were relatively homogeneous — if they were broadly in agreement with one another. Objecting to the proposed Constitution, the pseudonymous antifederalist Brutus emphasized this point: “In a republic, the manners, sentiments and interests of the people should be similar. If this be not the case, there will be a constant clashing of opinions, and the representatives of one part will be continually striving against those of the other.”

Those who favored the Constitution thought that Brutus had it exactly backward. In their view, the constant clashing of opinions was something not to fear but to welcome, at least if people collaborate — if they act as if they are engaged in a common endeavor. Sounding a lot like Professor Kahneman, Alexander Hamilton put it this way : “The differences of opinion, and the jarrings of parties” in the legislative department of the government “often promote deliberation and circumspection and serve to check excesses in the majority.”

Angry science is paralleled by angry democracy, a “nasty world of critiques, replies and rejoinders,” whose “aim is to embarrass,” Professor Kahneman said. That’s especially true, of course, in the midst of political campaigns, when the whole point is to win.

Still, the idea of adversarial collaboration has never been more important. Within organizations of all kinds — including corporations, nonprofits, think tanks and government agencies — sustained efforts should be made to lower the volume by isolating the points of disagreement and specifying tests to establish what’s right. Asking how a disagreement might actually be resolved tends to turn enemies, focused on winning and losing, into teammates, focused on truth.

As usual, Professor Kahneman was right. We could use a lot more of that.

Cass R. Sunstein is a law professor at Harvard and an author of “Noise,” with Daniel Kahneman and Olivier Sibony.

The Times is committed to publishing a diversity of letters to the editor. We’d like to hear what you think about this or any of our articles. Here are some tips . And here’s our email: [email protected] .

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Essay on Money: Meaning, Functions and Role

Read this essay to learn about the meaning, functions and role of money.

Meaning of Money:

Money has been defined differently by different economists. Some, like F.A. Walker, define it in terms of its functions, while others like G.D.H. Cole, J.M. Keynes, Seligman and D.H. Robertson lay stress on the ‘general acceptability’ aspect of money.

According to Prof. D.H. Robertson, “anything which is widely accepted in payment for goods or in discharge of other kinds of business obligation, is called money.” Seligman defines money as “one thing that possesses general acceptability.” Prof. Ely says: “Money is anything that passes freely from hand to hand as a medium of exchange and is generally received in final discharge of debts.”

Prof. A. Walker says “Money is that money does.” But these definitions are defective because they do not lay proper emphasis on all the essential functions of money. Prof. Crowther’s definition of money is considered better as it takes into account all the important functions of money. He defines money as “anything that is generally acceptable as a means of exchange (i.e., as a means of setting debts) and at the same lime, acts as a measure and a store of value.”

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It is a fact that although money was the first economic object to attract men’s thoughtful attention…there is at the present day not even an approximate agreement as to what ought to be designated by the world…the business world makes use of the term in several senses; while amongst economists there are almost as many different conceptions as there are writers on the subject.’

Functions of Money :

Money is a matter of functions four, a medium, a measure, a standard, a store.

Money in a modern economy performs important functions which have been classified by Kinley as follows:

(a) Primary functions also called fundamental and original functions like the medium of exchange and measure of value.

(b) Secondary functions like standard of deferred payments, store of value and transfer of value.

Medium of exchange:

Money serves as a medium of exchange and facilitates the buying and selling of goods, thereby eliminating the need for double coincidence of wants as under barter. A man who wants to sell wheat in exchange for rice can sell it for money and purchase rice.

Measure of value:

Money has also removed the difficulty of barter system by serving as a common measure of value. The values of various commodities are expressed in terms of money. Money as a measure of value has made transactions simple and easy. It may be understood that this function of money follows from the first basic function (medium of exchange). It is because money is used as a medium to exchange goods, that each good gets a value in terms of money (called price). As such, money also serves as a unit of account. In India, the unit of account is the Rupee, in USA, the Dollar; in USSR, the Rouble and the Yen in Japan.

Store of Value:

Classical economists did not recognize the store of value function of money. Keynes laid stress on this function of money. People store money to provide again the rainy day and to meet unforeseen contingencies. According to Keynes, people also store money to take advantage of the changes in the rate of interest. Money as a store preserves value through time and space. Money as a store of value through time means the shifting of purchasing power from the present to the future and as such it serves as an important link between the present and the future.

Money in this case is stored as a form of ‘asset’. Money is an asset or a form of wealth because it is a claim. It is the most convenient way of laying claim to such goods and services as one wishes to buy. Thus, rather than keeping their wealth in the form of non-liquid assets like houses, shares, etc., people prefer to keep their wealth in the form of money.

Money is the most liquid of all assets i.e., money can be readily exchanged for goods and services without any difficulty and the price of money or its value is stable at least over a short period. In fact, all assets like bonds, saving accounts, treasury bills, government securities, inventories and real estate do serve as stores of value, but they differ in the degree of liquidity; money amongst these possesses highest degree of liquidity and that is why people prefer it most as a store of value.

However, we should not give it undue importance because the value of money does not remain stable through time. As prices rise, people try to get rid of money as its value falls. Moreover, in modern economies storing wealth in the form of money is unimportant as it is done in the form of interest-bearing securities.

Money as a store of value through space continues to be important; for instance, an Indian businessman who sells his business and property and goes to USA and settles down there is a case of exporting value through space. In ancient times, gold and silver coins were used as a store of value followed by currency notes. In advanced countries today money is stored in the form of bank deposits.

Standard of Deferred Payments:

Money has always been used as a standard of deferred payment. This function of money has attained more importance in modern times with the extension of trade based on credit. As a result of this function, it has become possible to express future payments in terms of money. A borrower who borrows a certain sum in the present undertakes to pay the same in future. Similarly, a person who purchases on credit agrees to pay in future when his bills become due. Money as a standard of deferred payments is performing useful function enabling the current and present transactions to be discharged in future.

Contingent Functions:

Besides, the primary and secondary functions of money, Prof. Kinley lays stress on the contingent functions of money. Money facilitates the distribution of national income among the various factors of production. Land, labour, capital and organization all co-operate in an act of production and the product is the result of their joint efforts, which belongs to all of them.

Money makes the distribution of joint production, amongst various factors easy and paves the way for economic progress. Further, a concept like utility is measured in terms of money. A consumer as well as a producer measures the utilities of different goods and factors of production with the help of money and try to get maximum satisfaction or maximum returns.

Again, credit is the basis of modern economic progress. Money constitutes the basis of credit. Banks create credit not out of thin air but with the help of money. Moreover, money gives liquidity to various forms of wealth. A person by keeping his wealth in the form of money renders it most liquid.

Role of Money:

Money plays a vital role in the determination of income and employment. The basic problems of macroeconomics are the determination of income, output, employment and the general price levels, including the determination of the long-run rate of growth of income. As far as the growth theory is concerned, the supply and demand for money have been largely ignored until recently, yet all but the very simplest short-run income and price level determination models have a money market included in them.

As such, money becomes an economic force in its own right, which under certain circumstances, powerfully affects economic activities. This is the main subject matter of monetary economics. Monetary theory is that branch of economics which aims at discovering and explaining how the use of money in its various forms affects production, consumption and distribution of goods. As a matter of fact, the advocates of monetary theory plead that a large number of factors affect the volume of production, consumption and distribution. To them, money is no more a veil, a medium to facilitate exchange of goods: but something more vital, more crucial and more important, which affects the general level of economic activity.

Monetary theorists hold that the use of money as a medium of exchange, as a store of value, as a measure of value, as a standard of deferred payments along with its contingent functions has the capacity of influencing the volume and direction of economic activity that would not occur in a barter economy. In a monetary economy, according to Keynes, “money plays a part of its own and affects motives and decisions and is, in short, one of the operative factors in the situation, so that the course of events cannot be predicted, either in the long period or in the short, without a knowledge of the behaviour of money between the first state and the last.” In such a world, money is not a neutral phenomenon rather a phenomenon governed by principles very different from those that hold sway over the process of production and exchange.

In modern income and employment analysis, these are two spheres of economic activity. There is, on the one hand, the real or goods sector, which has to do with forces of aggregate demand and supply and the conditions under which an equilibrium of output and employment is achieved. On the other hand, there is the monetary sphere in which the economic forces at work are those centering around the demand for money.

According to the modern view, the existence of a separate monetary sphere of activity is a fact of profound significance; what takes place in the monetary sphere may suddenly and dramatically influence the level of both output and employment. The method by which Keynes brings money into the picture is through the development of a theory of interest in which the demand for money is dominant. The rate of interest is the link between the real sphere and the monetary sphere. It is a factor around which the theory of investment is constructed and investment expenditure is one of the key determinants of income and employment.

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Money Essay | Importance and Benefits of Money Essay in English

Money Essay: Money is a vital wellspring of everyday routine to experience a solid and satisfying life, despite the fact that it can not measure up to adore and mind. Both have their own significance and benefit. We are giving articles on Money to partake in a paper composing contest in basic and basic words here.

Money is the medium utilized by individuals to purchase required labor and products. It is utilized as the source to satisfy fundamental requirements and is additionally a wellspring of solace throughout everyday life. Money is the main source to carry on with a sound and prosperous life; nonetheless, it couldn’t measure up to the meaning of affection and care. Both have their own significance and advantages. By the way, Money is a helpful and important product to live cheerily arranging all your standard liabilities towards your family and friends and family.

You can read more Essay Writing about articles, events, people, sports, technology many more.

Short Essay on Money 300 Words in English

Money is the fundamental need of life, without which nobody can envision a sound and tranquil life. We need money to satisfy our littlest needs. In present-day times, when progress is growing quickly and everybody is following western culture, in such a period, we need more money because of expanding merchandise. On prior occasions, there was training called trade framework, in which anybody would get another thing in return for a certain something. In any case, presently in this advanced world, just Money is expected to purchase everything or thing. it happens.

These days you need Money for each work, for garments, for food, for a safe house and surprisingly in numerous spots you need to pay for water. Despite the fact that it can likewise be said that ‘Money can’t give joy’s yet would you be able to be content with no Money? Since Money is a major piece of our life, at any rate you need Money to be content.

The significance of Money is expanding step by step, in light of the fact that our living has gotten over the top expensive. The significance of Money has expanded for a huge scope in the fields of creation, utilization, trade, circulation, public income and so on It assumes a vital part in deciding pay, work, continues partnership, general value level and so on On the off chance that we take a gander at the present-day situation, there is no uncertainty that he, who has a lot of riches, is viewed as more cultivated on the planet. Consequently, we can say that Money is vital in each part of life.

Importance of Money

Money is a fundamental thing throughout everyday life. In any case, it can’t accept things like time, love and genuine consideration. It can just satisfy the outer requirements of an individual and not the interior necessities like love. These days, everything has gotten costly yet getting them is vital to carry on with basic life. In the event that we don’t have money, nobody can envision the reality of how our circumstances will be.

The demise of an individual is sure because of the absence of Money and on the off chance that he endures, he experiences to confront numerous difficulties. Abundance empowers us to purchase every one of the essential things and helps us for the duration of our life. In the event that we comprehend the significance of Money throughout everyday life, we won’t ever go through Money with no reason or abuse. We can’t look at Money and love, in light of the fact that to carry on with a fruitful life we need both Money and love.

In this cutthroat world, to bring in Money by finding a decent line of work, everybody needs to concentrate well with advanced education from a notable school or college. An individual needs to bring in more money to satisfy the prerequisite of the relative multitude of individuals in the family, particularly for the individual who is the lone worker in the family.

An individual necessities Money to address the issues of all his relatives to eat, wear, and live. The rich have an uncommon personality and notoriety in the general public, be that as it may, the needy individuals spend their lives just getting two suppers per day. Every one of these progressions and contrasts are because of Money as it were.

In any place where there is a shortage of money in the house, there are a lot of struggles. There are squabbles among a couple. Neither does anybody regard each other in the case of bringing in Money. Neighbors and family members likewise peer downward on the destitute individual. He begins cutting her reasoning that the individual never requests Money from her. With this, nobody needs to get to know a destitute individual in the present time.

Money can neither purchase nor stop time nor purchase genuine romance and care together. Yet at the same time it is needed by all, so life can be taken in the correct way. Despite the fact that Money can’t give time and love, it certainly gives us bliss, certainty, fulfillment, physical and mental harmony. Because of which we can carry on with life effectively and each troublesome issue can be settled.

Advantage from Money

You can carry on with a conscious life: An individual is regarded just when he is monetarily prosperous. Something else, in the present society, the bankrupt individual has no regard.

Unadulterated and nutritious food can be eaten: The individuals who have abundance can appreciate an assortment of heavenly and nutritious dinners. What’s more, they can shield themselves from sicknesses.

Your assurance should be possible: In the present society, burglary, theft have expanded a great deal and rich individuals can give security to themselves because of Money.

The credit is repayable: Obligation taken from an individual rich individual can reimburse the credit without any problem.

The happiness regarding material delights can be achieved: With an adequate measure of riches, all material solaces can be appreciated like taking a decent house, great garments, vehicles and different things.

FAQ’s on Money Essay

Question 1. What is the requirement for money?

Answer: The main capacity of cash is to fill in as a mechanism of trade. As a mechanism of trade, cash addresses every one of the troubles of the deal. There is no need for a twofold fortuitous event of needs in a cash economy.

Question 2. What are the benefits of money?

Answer: Having money with you gives you a respectful life, you can have a healthy and nutritious life, you can pay your loans, have a luxurious life, etc.

Question 3. How can we earn money?

Answer: There are a number of ways to earn money such as;

You can be an employee in a company
You can start your own business
You can be an entrepreneur
You can use social media channels to provide your service

Money Essay

Money is the medium used by people to buy required goods and services. It is used as the source to fulfill basic needs and is also a source of comfort in life. Money is the most important source to live a healthy and prosperous life; however, it cannot be compared with the significance of love and care. Both have their own importance and benefits. Nevertheless, money is a useful and necessary commodity to live contentedly disposing all your usual liabilities towards your family and loved ones.

Long and Short Essay on Money in English

We have provided some simply written essay on money to help your kids to do better in their essay writing competition.

These Money Essay are written in easy English so that student of any class can easily understand it and also reiterate it or write it down, whenever required.

We have divided following essays under long and short essay on money in English according to the need, to help your kids to do better in their school competitions.

These essay on money will prove useful in your school assignments or general discussion with your family and friends.

Money Essay 1 (100 words)

Money is the most basic requirement of the life without which one cannot fulfill his basic needs and requirements of the daily routine. We can never compare the importance of the money with the importance of love or care. When one need money, love cannot fulfill this requirement and if one need love, money cannot fulfill this requirement.

Both are highly required for the healthy life but they have their significance and importance separately. Both are required by us on urgent basis so we cannot rank both on the same scale. We need money everywhere such as to eat food, to drink water or milk, to see TV, news, subscribe newspaper, wear clothe, get admission and many more requirements.

Money Essay 2 (150 words)

Money is the basic requirement of the life without which one cannot imagine a healthy and peaceful life. We need money even buying a little needle. In the modern time, where growth of civilization is going very fast and following western culture, we need more money because of the increasing prices of everything. Earlier there was a system called barter system in which one was allowed to exchange things to get goods however, in the modern one need only money to buy everything.

The importance of money is increasing day by day as the living has become so costly. The significance of money has increased to a great extent in the field of production, consumption, exchange, distribution, public finance and etc. It plays a very crucial role in determining the input, income, employment, output, general price level of anything, etc.

Money Essay 3 (200 words)

In such a costly and competitive society and world, no one of us can live without money. We need money to fulfil our basic needs of the life such as buying food, and other many basic necessities of life which are almost impossible to buy without money. People in the society who are rich and have property are looked as honourable and respectful person of the society however a poor person is seen as hatred without any good impression.

Money increases the position of the person in the society and gives good impression to him. All of us want to be rich by earning more money through good job or business in order to fulfil all the increasing demands of the modern age. However, only few people get this chance of completing their dreams of being a millionaire.

So, money is the thing of great importance all through the life. Money is required by everyone whether he/she is rich or poor ad living in urban areas or rural areas. People in the urban areas are earning more money than the people living in backward or rural areas as the people of the urban areas have more access to the technologies and get more opportunity because of the easy sources.

Money Essay 4 (250 words)

Money is very much required thing in the life however; it cannot buy things like time, love and true care. It can only fulfil the outer needs of the person and not the inner needs like true love. Now-a-days, everything has become so costly but necessary to buy for living a simple life. And what if we have no money, either we would die or suffer more if saved.

Money has capability to buy anything virtually and helps us a lot throughout the life. By taking the importance of the money in our life we should never destroy or waste the money without any purpose. We should not compare the money and love because both are required separately to run a successful life.

In this competitive world, everyone wants to get good study with higher education from the popular college and university to get good job in order to earn more money. A person needs more money to fulfil the requirement of the all members of the family especially one who is only working person of the family.

He or she needs to fulfil the eating, clothing and living requirements of the family members and for that money is required. Rich people of the society are given particular recognition and popularity however poor people live their life by arranging just food for two times a day. All the changes and differences are just because of the money.

Money Essay 5 (300 words)

Money is really a very important thing for the human beings to lead their life in the satisfactory way. Unlike animals and plants, we need more money everywhere. In order to live in the society, we need to maintain our status and position in the society for which we need money. In order to eat food or drink water, wear cloth, get admission to the school, take medicine or go to the hospital and other many activities we need lots of money. Now the topic arise is, where we got such required money. We need to get higher level study and do hard works to get good job or open our own business which requires more skill and confidence.

Earlier the condition of poor people was very poor because of the pressure of the rich people. They were not helping the poor people and use them only as a servant on the very low salary. However the condition of the poor people has become good as the rule and regulations of the government as been change in order to equalize the condition of both. Now everyone has equal rights to study higher and get good job. Many people understand that money is the origin of the evil in the mind however I do not think so because thinking is the process of human mind and not the creation of money.

I understand and believe that money is the most important key of happiness gifted by the God. It is the human mind to take anything in different ways. Some people take it only to fulfil their physical needs and they never take it heartily however some people understand everything to the money and they can do anything for getting the money such murder, corruption, underworld work, smuggling, promoting bribe, etc.

Money Essay 6 (400 words)

There is no any doubt that money is so essential for our healthy living. Money is almost everything for us to live a life and maintain the good stats in the society. It is the money which fulfils the need of bringing necessary comforts and amenities of the life. If one has money, he/she can get anything in his/her life. It is the money which helps us in developing good personality, improving confidence, makes us able to creditworthiness, improving capacity, increasing capabilities and enhancing our courage to a great level. Without money we feel helpless and alone in this world where no one is ready to help and assist. In the current materialistic world, money is very important and powerful thing without which one cannot live and survive.

Now-a-days, in order to earn more money in wrong ways, bad people are taking help of corruption, bribe, smuggling, murder rich people of the society, and other callous activities by degrading the moral and ethical values of the humanity. Lazy people follow wrong ways to earn money as they understand that these ways are simple and easy however it is not true. One can earn more money in less time and effort but not for long; surely he would be lost in the near future as he is following wrong and weak way. The people who are earning money by following all the rules of humanity earn less money but for long time and they become the high status personality of the society.

People doing corruption save their money as a black money in other countries to keep hidden from the common public and use that money for bad works or increasing their physical luxury. However, common people of the society respects a lot to the people earning money using wrong techniques as they have fear of them and little bit greediness that they can get some money in return whenever required by giving them respect. They are generally called as the bhai or dada or don. Money cannot buy or stay the time as well as cannot give true love and care however highly required by all of us to run the life on the right path. It cannot give time and love however gives happiness, confidence, satisfaction, feeling of well being mentally and physically, makes life easy by solving all the difficulties, and many more.

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Essay on Honesty is the Best Policy

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What Is Time Value of Money?
Understanding TVM

The Bottom Line

Corporate Finance
Financial Ratios

Time Value of Money Explained with Formula and Examples

Katrina Ávila Munichiello is an experienced editor, writer, fact-checker, and proofreader with more than fourteen years of experience working with print and online publications.

What Is the Time Value of Money (TVM)?

The time value of money (TVM) is the concept that a sum of money is worth more now than the same sum will be at a future date due to its earnings potential in the interim. The time value of money is a core principle of finance. A sum of money in the hand has greater value than the same sum to be paid in the future. The time value of money is also referred to as the present discounted value.

Key Takeaways

The time value of money means that a sum of money is worth more now than the same sum of money in the future.
The principle of the time value of money means that it can grow only through investing so a delayed investment is a lost opportunity.
The formula for computing the time value of money considers the amount of money, its future value, the amount it can earn, and the time frame.
For savings accounts, the number of compounding periods is an important determinant as well.
Inflation has a negative impact on the time value of money because your purchasing power decreases as prices rise.

Investopedia / Mira Norian

Understanding the Time Value of Money (TVM)

Investors prefer to receive money today rather than the same amount of money in the future because a sum of money, once invested, grows over time. For example, money deposited into a savings account earns interest. Over time, the interest is added to the principal, earning more interest. That's the power of compounding interest.

If it is not invested, the value of the money erodes over time. If you hide $1,000 in a mattress for three years, you will lose the additional money it could have earned over that time if invested. It will have even less buying power when you retrieve it because inflation reduces its value .

As another example, say you have the option of receiving $10,000 now or $10,000 two years from now. Despite the equal face value, $10,000 today has more value and utility than it will two years from now due to the opportunity costs associated with the delay. In other words, a delayed payment is a missed opportunity.

The time value of money has a negative relationship with inflation . Remember that inflation is an increase in the prices of goods and services. As such, the value of a single dollar goes down when prices rise, which means you can't purchase as much as you were able to in the past.

Time Value of Money Formula

The most fundamental formula for the time value of money takes into account the following: the future value of money, the present value of money, the interest rate, the number of compounding periods per year, and the number of years.

Based on these variables, the formula for TVM is:

F V = P V ( 1 + i n ) n × t where: F V = Future value of money P V = Present value of money i = Interest rate n = Number of compounding periods per year t = Number of years \begin{aligned}&FV = PV \Big ( 1 + \frac {i}{n} \Big ) ^ {n \times t} \\&\textbf{where:} \\&FV = \text{Future value of money} \\&PV = \text{Present value of money} \\&i = \text{Interest rate} \\&n = \text{Number of compounding periods per year} \\&t = \text{Number of years}\end{aligned} F V = P V ( 1 + n i ) n × t where: F V = Future value of money P V = Present value of money i = Interest rate n = Number of compounding periods per year t = Number of years

Keep in mind, though that the TVM formula may change slightly depending on the situation. For example, in the case of annuity or perpetuity payments, the generalized formula has additional or fewer factors.

The time value of money doesn't take into account any capital losses that you may incur or any negative interest rates that may apply. In these cases, you may be able to use negative growth rates to calculate the time value of money

Examples of Time Value of Money

Here's a hypothetical example to show how the time value of money works. Let's assume a sum of $10,000 is invested for one year at 10% interest compounded annually. The future value of that money is:

F V = $ 10 , 000 × ( 1 + 10 % 1 ) 1 × 1 = $ 11 , 000 \begin{aligned}FV &= \$10,000 \times \Big ( 1 + \frac{10\%}{1} \Big ) ^ {1 \times 1} \\ &= \$11,000 \\\end{aligned} F V = $10 , 000 × ( 1 + 1 10% ) 1 × 1 = $11 , 000

The formula can also be rearranged to find the value of the future sum in present-day dollars. For example, the present-day dollar amount compounded annually at 7% interest that would be worth $5,000 one year from today is:

P V = [ $ 5 , 000 ( 1 + 7 % 1 ) ] 1 × 1 = $ 4 , 673 \begin{aligned}PV &= \Big [ \frac{ \$5,000 }{ \big (1 + \frac {7\%}{1} \big ) } \Big ] ^ {1 \times 1} \\&= \$4,673 \\\end{aligned} P V = [ ( 1 + 1 7% ) $5 , 000 ] 1 × 1 = $4 , 673

Effect of Compounding Periods on Future Value

The number of compounding periods has a dramatic effect on the TVM calculations. Taking the $10,000 example above, if the number of compounding periods is increased to quarterly, monthly, or daily, the ending future value calculations are:

Quarterly Compounding: F V = $ 10 , 000 × ( 1 + 10 % 4 ) 4 × 1 = $ 11 , 038 FV = \$10,000 \times \Big ( 1 + \frac { 10\% }{ 4 } \Big ) ^ {4 \times 1} = \$11,038 F V = $10 , 000 × ( 1 + 4 10% ) 4 × 1 = $11 , 038
Monthly Compounding: F V = $ 10 , 000 × ( 1 + 10 % 12 ) 12 × 1 = $ 11 , 047 FV = \$10,000 \times \Big ( 1 + \frac { 10\% }{ 12 } \Big ) ^ {12 \times 1} = \$11,047 F V = $10 , 000 × ( 1 + 12 10% ) 12 × 1 = $11 , 047
Daily Compounding: F V = $ 10 , 000 × ( 1 + 10 % 365 ) 365 × 1 = $ 11 , 052 FV = \$10,000 \times \Big ( 1 + \frac { 10\% }{ 365 } \Big ) ^ {365 \times 1} = \$11,052 F V = $10 , 000 × ( 1 + 365 10% ) 365 × 1 = $11 , 052

This shows that the TVM depends not only on the interest rate and time horizon but also on how many times the compounding calculations are computed each year.

How Does the Time Value of Money Relate to Opportunity Cost?

Opportunity cost is key to the concept of the time value of money. Money can grow only if it is invested over time and earns a positive return. Money that is not invested loses value over time. Therefore, a sum of money that is expected to be paid in the future, no matter how confidently it is expected, is losing value in the meantime.

Why Is the Time Value of Money Important?

The concept of the time value of money can help guide investment decisions. For instance, suppose an investor can choose between two projects: Project A and Project B. They are identical except that Project A promises a $1 million cash payout in year one, whereas Project B offers a $1 million cash payout in year five. The payouts are not equal. The $1 million payout received after one year has a higher present value than the $1 million payout after five years.

How Is the Time Value of Money Used in Finance?

It would be hard to find a single area of finance where the time value of money does not influence the decision-making process. The time value of money is the central concept in discounted cash flow (DCF) analysis, which is one of the most popular and influential methods for valuing investment opportunities. It is also an integral part of financial planning and risk management activities. Pension fund managers, for instance, consider the time value of money to ensure that their account holders will receive adequate funds in retirement.

What Impact Does Inflation Have on the Time Value of Money?

The value of money changes over time and there are several factors that can affect it. Inflation, which is the general rise in prices of goods and services, has a negative impact on the future value of money. That's because when prices rise, your money only goes so far. Even a slight increase in prices means that your purchasing power drops. So that dollar you earned in 2015 and kept in your piggy bank buys less today than it would have back then.

How Do You Calculate the Time Value of Money?

The time value of money takes several things into account when calculating the future value of money, including the present value of money (PV), the number of compounding periods per year (n), the total number of years (t), and the interest rate (i). You can use the following formula to calculate the time value of money: FV = PV x [1 + (i / n)] (n x t) .

The future value of money isn't the same as present-day dollars. And the same is true about money from the past. This phenomenon is known as the time value of money. Businesses can use it to gauge the potential for future projects. And as an investor, you can use it to pinpoint investment opportunities. Put simply, knowing what TVM is and how to calculate it can help you make sound decisions about how you spend, save, and invest.

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Time Value of Money: What You Should Know Essay

The time value of money is a paramount financial concept, according to which a certain amount is now worth more than the same amount in the future. This is due to the possibility of investing at the moment and generating income, which will lead to an increase in the amount of money in subsequent years. Another reason is that the expectation of cash flows in the future always carries the risk of default. Schmidt (2021) highlights two methods for determining the time value of money – discounting and compounding. Discounting is used to calculate how much money needs to be invested currently to get a given amount in the future. Compounding, the inverse of discounting, is done to determine how much money can be received in the future if they are invested a certain amount presently.

When assuming the time value of money, one must always consider inflation and the corresponding adjustment in purchasing power. Inflation hurts the ability to buy goods. By reducing the value of money, this economic phenomenon reduces purchasing power without changing the amount of money available. If the estimated return is less than inflation, it may turn out that money is made, but purchasing power is lost.

There are five main components of the time value of money: rates, periods, present value, future value, and payments. Schmidt (2021) notes that by knowing any 4 of the five components, one can easily find the fifth one. Based on this, the author highlights the practical problems of the time value of money. According to Schmidt (2021), there are three main types of compounding problems and three basic types of discounting problems, which form 6 dollar functions.

The author distinguishes three basic types of compound tasks: the future value of a single sum, the future value of a series of payments, and the amount of payment required to achieve the future value. In turn, the other half of the six functions of the dollar is related to discounting. These time value of money issues include determining the present value of a single sum, the present value of a series of payments, and the amount of payment required to amortize the present value, such as a loan. The author provides a decision table containing answers to the above six problems. Because these fundamental time value of money issues crop up in finance and commercial real estate, mastering them is essential to improving skills.

Schmidt, R. (2021). What you should know about the time value of money . Property Metrics. Web.

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