Important Characteristics of Money

To be acceptable as a medium of exchange, money must be fairly easy to use, it must be trusted, and it must be capable of performing its functions. Together, these requirements give rise to five essential characteristics:

Divisibility The standard unit of money must be divisible into smaller units to accommodate small purchases as well as large ones. American standard is the dollar, and it is divided into one-hundredths, one-twentieths, one-tenths, one-fourths, and one-halfs through the issuance of coins (pennies, nickels, dimes, quarters, and half-dollars, respectively). These allow people to make purchases of less than a dollar and of odd amounts greater than a dollar.

Portability Money must be small enough and light enough to be carried easily. For this reason, paper currency, is issued in larger denominations— multiples of the standard unit. Five-, ten-, twenty-, fifty-, and hundred-dollar bills make our money convenient for almost any purchase.

Stability Money should retain its value over time. When it does not (during periods of high inflation), people tend lo lose faith in their money. They may then turn to other means of storing value (such as gold and jewels, works of art, and real estate). In extreme cases, they may use such items as a medium of exchange as well. They may even resort to barter.

Durability The objects that serve as money should be strong enough to last through reasonable usage. No one would appreciate (or use) dollar bills that disintegrated as they were handled or coins that melted in the sun.

Difficulty of CounterfeitingIf a nation’s currency were easy to counter­feit—that is, to imitate or fake—its citizens would be uneasy about accepting it as payment. Even genuine currency would soon lose its value, because no one would want it. Thus the countries that issue currency do their best to ensure that it is very hard to reproduce.


A) Find in the text the words that are the synonyms of:

1. on condition that= 6. to rise=

2. problem= 7. worn-out (adj)=

3. necessity= 8. to forge=

4. to help= 9. difficult=

5. outright (adv)= 10. banknote=

B) Explain the meaning of the following phrases of words:

1. to be roughly equal in value

2. to come into play

3. to be in great demand

4. to be at hand

5. to follow suit

6. to be fairly easy to use sth

7. to last through reasonable usage

C) Give English equivalents:

1. mijloc de schimb/средство обмена

2. măsurare a valorii/мера стоимости

3. numitor comun/общий знаменатель

4. lot de pămînt/участок земли

5. conservarea valorii/сохранение стоимости

6. banknotele se emit în valoarea mai mare/денежные купюры выпускаются большим достоинством

7. a-şi pierde încrederea/потерять веру

8. proprietatea imobiliară/недвижимость

9. moneda veritabilă/подлинные деньги

10. oamenii cu un venit mai scăzut/люди с более низким доходом.


A) Give answers to the following questions:

1. What is money and what do you know about its history?

2. What is barter and what is the trouble with it?

3. What is commodity money and who used this money?

4. Why do people need money?

5. Name the functions of money and characterize them.

6. Enumerate the characteristics of money. Which one seems the most appealing to you and why?

7. Why should the standard unit of money be divided into smaller units? Associate the following coins with the Moldavian ones:

a) a penny – d) a quarter -

b) a nickel – e) a dime -

c) a half-dollar -

8. Why is paper money issued in larger denominations?

9. When do people tend to lose faith in their money? What do they do in this case?

10. What do people usually do with handled or deteriorated bills or coins?

11. Why do issuers of currency make it very hard to be reproduced?

12. Money counterfeiting – is it a criminal or a civil case? What happens to counterfeiters according to the appropriate articles of law in our country? Do you agree with the punishment stipulated in these articles?

B) Find in the text the words to the following definitions:

1. coins and paper money ________________

2. the means of exchanging sth for sth without using money ________________

3. the necessity to save money for a time when you will really need it _________

4. anything that is accepted as payment for products and resources __________

5. the quality of being steady and not changing in any way _________________

6. a means for retaining and accumulating wealth _______________________


1. What role does money play in your life?

For instance, you have been offered 2 jobs:

I) a part-time, attractive, low-paid job

II) a full-time, dirty (from the ethical point of view), rather well-paid job

What would you choose and why?

2. If you possessed a large amount of money, what would the advantages and disadvantages of the following be?

· putting it under the mattress

· buying a lottery ticket

· visiting a casino

· depositing it in a bank

· buying gold

· investing it in your own business

· buying a Van Gogh painting

· buying shares of a corporation

· investing it in real estate

· going on a spending spree

Choose out of these 3 items that would characterize your actions concerning your money. Give your reasons. Use the following structure:

If I possessed a large amount of money I would …

3. How much money do you need to consider yourself to be a rich person? Is it possible to earn this sum of money in an honest way in our Republic?

4. When you see a person for the first time, can you detect whether the person is rich, with average income, or poor. If yes, than how?

5. Can everything be bought with money?

6. What would be the consequences of a world without money? Would there be no poverty? Could we use a barter system instead?


Fill in prepositions:

1. Our company decided to trade our services ______ the products of our commercial partners.

2. The trouble ______ wax is that it melts _____ the sun.

3. Money eliminates the problems associated ______ the barter system.

4. I bought his share of business ______ $20000.

5. When people lose faith ____ their money, they may resort _____ barter.

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