ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The qualities of money are as follows : 1) General Acceptability : Anything which is used as money must be easily accepted by all for exchange purpose. 2) Divisibility : Money should be easily divisible into smaller denominations to facilitate small transactions.

Detailed explanation-2: -Divisibility. Money must be made in various units. You should be able to make change. By having various units of money, goods of various value can be paid for, and change for larger units of money can be made.

Detailed explanation-3: -Divisibility is the property of a good that can be broken into smaller amounts without losing value. Because economic transactions frequently occur in varying amounts, a currency must be divisible to be used broadly in an economy.

Detailed explanation-4: -in fact, a variety of items have been used as money over the centuries. The items that worked the best tended to have four basic characteristics: portability, divisibility, durability, and acceptability.

Detailed explanation-5: -If someone wants to buy a smaller unit of a commodity, then divisibility of money can make it possible. For example, cows cannot function as good money. This is because you cannot divide a cow without making it lose its value.