LAQ for Chapter 11 From Barter to Money Class 7 Social Science NCERT
Important Questions1
Q1: What were the main challenges of the barter system, and how did money address these issues?
Answer
• The barter system faced challenges such as the double coincidence of wants, where both parties needed to have what the other wanted.• There were also issues with measuring value, dividing goods, and portability.
• Money addressed these by providing a universally accepted, portable, divisible, and durable medium of exchange.
• It allowed for easy transactions, saving, and future payments, making trade more efficient.
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2
Q2: How did the introduction of coins benefit ancient India’s economy and trade?
Answer
• Coins helped facilitate trade by offering a standardized, easily portable, and widely accepted form of money.• In ancient India, coins made from precious metals like gold, silver, and copper were used for transactions.
• The use of coins allowed for easier trade within the region and with foreign countries, such as during the Roman trade. The presence of coins helped stimulate economic activity and provided a stable basis for conducting business.
Digital Currency
LAQ
3
Q3: What are the functions of money, and how do they help the economy?
Answer
• Money serves as a medium of exchange, a store of value, a common denomination for measuring the value of goods, and a standard of deferred payment.• These functions help simplify trade by providing a common tool for transactions, enabling people to save wealth for future use, compare prices, and make payments over time.
• The functions of money contribute to economic stability by making transactions smoother and more predictable.
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4
Q4: How did the transition from barter to money impact social and cultural life?
Answer
• The transition from barter to money made trade more efficient, allowing for greater social interaction and the expansion of economies.• With the ability to store wealth and trade more easily, people could engage in more diverse economic activities, from farming to craftsmanship.
• This shift also led to greater cultural exchanges, as people could now trade goods across longer distances, influencing art, philosophy, and other cultural aspects.
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5
Q5: Why is the standard of deferred payment an important function of money?
Answer
• The standard of deferred payment allows people to make transactions over time by agreeing to pay at a later date.• This function is important because it enables businesses and individuals to engage in long-term contracts and investments, providing flexibility in financial planning.
• It allows for purchases that may be too expensive to pay upfront, such as education, real estate, or larger goods, supporting both economic growth and personal financial management.
LAQ
6
Q6: How did paper currency evolve, and what role did it play in modern economies?
Answer
• Paper currency evolved in ancient China and was introduced to India in the 18th century by banks. It was used for higher denominations, making large-scale transactions easier.• Paper currency facilitated economic growth by providing a more convenient alternative to heavy coins, promoting trade and commerce.
• Today, it plays a crucial role in modern economies by being the main medium for most transactions, controlled by central banks to ensure stability.
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7
Q7: How has the rise of digital money impacted traditional systems of payment?
Answer
• The rise of digital money has transformed traditional payment systems by providing faster, more convenient alternatives like mobile payments, credit and debit cards, and online banking.• Digital money has made transactions quicker and more accessible, especially for online shopping, reducing the need for physical currency. It has also expanded financial inclusion by allowing people in remote areas to access banking services through smartphones and the internet.
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8
Q8: How did the development of trade routes impact the evolution of money and currency?
Answer
• The development of trade routes, such as those connecting India to the Roman Empire, encouraged the need for a standardized form of money.• Trade across long distances required a universal medium of exchange that could be easily carried and recognized. This led to the invention of coins, which facilitated smoother and more secure transactions.
• Over time, the growth of trade networks and the increasing complexity of economies led to the evolution of paper money and, later, digital currency.
LAQ