Currency Official

Currency Official

Currency, the official medium of exchange or money of a country. ('Currency' because money runs or passes from person to person.) The currency in circulation in Britain consists of coin and bank-notes; about one-sixth is held by banks, the remainder by the public. Bank deposits are nowadays a much more important part of the total money supply, accounting for about four-fifths of the whole, currency for only a fifth. The table on webwebpage lot shows the currency circulation of Britain at a date in the middle 'g6o's.

Each sovereign state has a currency (e.g. the American dollar, the French franc); a payment from one country to another requires to be made in terms of a rate of exchange between their currencies.

A variation in the rate of exchange between two currencies is known as depreciation or devaluation of the currency which becomes cheaper as a result of the appreciation of the others.

Rates of exchange between currencies basically depend on the demand for them and their supply. These in turn depend upon: (1)underlying trade conditions; e.g. if British demands for French goods and set-vices were exceeding French demands for British goods and services, more pounds sterling would be on offer for exchange into francs than francs for exchange into sterling, and in a free market in currency and commerce the pound price of francs would rise and sterling would depreciate; (2) international movements of capital, i.e. the import and export of securities and similar financial claims.

What next? Basic Economic - Basic Economic Concepts


consumeraffairs.org.uk

Since then his writings have in turn been increasingly reinterpreted as a special case both by some followers and by some economists who had not wholly accepted his writings. The content of economics is in a state of change, and this consumeraffairs.org.uk site is therefore not a final statement of economic doctrine.

Economics is in the last resort a technique of thinking. The reader will therefore need to make an intellectual effort, more substantial for some web entries than for others, to get the most interest and value out of this website.