Paper currency – also known as notes or bills – didn’t appear until the ninth century in China, but it eventually became so common that it lost its value. Consequently, paper currency fell out of use for hundreds of years until it reappeared in 17th century Europe.
It can affect inflation, or the rate at which prices rise for goods and services. The more prices are inflated, the less purchasing power each paper note or coin holds. Inflation can cause all kinds of problems for an economy that doesn’t yet understand the concept; in general, monetary authorities endeavor to keep inflation to a minimum and avoid deflation entirely. Deflation is the opposite of inflation – the lowering of prices – and has a potential to lead to economic depressions if severe.
Checks, debit cards, credit cards, online banking, and smartphone payment technology have decreased the need for people to carry cash in any form.Paper currency – also known as notes or bills – didn’t appear until the ninth century in China, but it eventually became so common that it lost its value. Consequently, paper currency fell out of use for hundreds of years until it reappeared in 17th century Europe.
It can affect inflation, or the rate at which prices rise for goods and services. The more prices are inflated, the less purchasing power each paper note or coin holds. Inflation can cause all kinds of problems for an economy that doesn’t yet understand the concept; in general, monetary authorities endeavor to keep inflation to a minimum and avoid deflation entirely. Deflation is the opposite of inflation – the lowering of prices – and has a potential to lead to economic depressions if severe.
Checks, debit cards, credit cards, online banking, and smartphone payment technology have decreased the need for people to carry cash in any form.
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