 |
Business | Industries | Finance | Tax |
| Index: > A B C D E F G H I J K L M N O P Q R S T U V W X Y Z |
|
|||||
| First Prev [ 1 2 3 4 ] Next Last |
A currency is a unit of exchange, facilitating the transfer of goods and services. It is a form of money, where money is defined as a medium of exchange rather than e.g. a store of value. A currency zone is a country or region in which a specific currency is the dominant medium of exchange. To facilitate trade between currency zones, there are exchange rates i.e. prices at which currencies (and the goods and services of individual currency zones) can be exchanged against each other.
Typically, each country has given monopoly to a single currency, controlled by a state owned central bank, although exceptions to this rule exist. Several countries can use the same name, each for their own currency (e.g. Canadian dollars and US dollars), several countries can use the same currency (e.g. the euro), or a country can declare the currency of another country to be legal tender (e.g. Panama and El Salvador have declared US currency to be legal tender).
Each currency typically has one fraction currency, often valued at 1/100 of the main currency: 100 cents = 1 dollar, 100 centimes = 1 francThe franc is the name of several currency units. The name is said to derive from the Latin inscription francorum rex ("King of the Franks") on early French coins, or from the French franc meaning "free". Countries which use francs include Switzerland and. Units of 1/10 or 1/1000 are also common, but some currencies do not have any smaller units. MauritaniaThe Islamic Republic of Mauritania is a country in northwest Africa. Its coast faces the Atlantic Ocean, between Western Sahara on the north and Senegal on the south. It should not be confused with the ancient country of Mauretania. Mauritania and Madagas is the only remaining country that does not use the decimal system; the only smaller currency unit is the khoum, which equals 1/5 of a ouguiya (UM).
The history of currencies follows the history of money closely. Although any form of Representative moneyRepresentative money refers to money that consists of a token or certificate that can be exchanged for a fixed quantity of a commodity such as gold, silver or potentially water, oil or food. This is to be distinguished from commodity money which is actual can be considered currency, the term is typically applied to standardized coinage, and the systems that developed from it. left King Juan Carlos of Spain on the two euro Spanish coin Prior to the introduction of standard coinage, calculating the value of a metal-based money required several steps. First, the metal was tested on a touchstone to calculate the quality, then it was weighed, and then the two values were multiplied. Thus, if someone alloyed gold and lead (which was a common cheating process) the metal's weight was multiplied by the percentage of gold to get the weight of the gold alone.
Coinage was introduced to simplify this process. Coins were created of a set weight and gold quality, and then stamped to prove their worth. No measurement was needed, as long as the original values were known. Of course, one could use an alloy with the same stamp as the coin to cheat, but the stamps were complex and thus difficult to duplicate (at the time).
More modern currency systems developed from the introduction of coins. The process started with the replacement of the original metal, with a coin representing it. The gold itself was kept safe in government vaults. Failure to maintain these stores results in a fiat currency. Examples of this system in the past was the gold standard, where the US Dollar was backed with gold stored at Fort Knox, and the British Pound Sterling, which was backed by one pound of sterling silver at its inception in 1158 in the hands of King Henry II. After WWII, the gold standard was abolished by the Bretton Woods system and many currencies were pegged to the USD.
The evolution continued, first to paper representations of the same standard, and finally to removing the metal altogether - the paper itself is considered to be valuable.
In order to prevent forged currency, various technologies such as watermarks are inserted into most paper currencies. In the early 21st century, the use of RFID tags has been proposed to track bank notes which were illegally obtained. Such efforts have been criticized by privacy advocates and those concerned about theft, because RFID readers are readily available and would reveal who has large amounts of cash.
| Politics | Business | Finance |
 |
 |
 |
|