You may now proceed to Lesson Six. Money is a good that is widely accepted for exchange. It can be anything that acts as a medium of exchange , a measure of value , and a store of value . A medium of exchange is something that is generally accepted as payment. Measure of value refers to anything that people can use to compare the worth of things that they buy and sell.
Store of value refers to anything that is easily stored for later spending.
Besides those broad qualitative criteria, money must also be durable, portable, divisible, and stable in value. Throughout history, the items used as money have changed. Initially, in each civilization some scarce and desirable item became the common object of trade because almost everyone would accept it as useful and valuable. This has included such items as cows, tobacco, stones, whale teeth, precious metals, and many others. Eventually, currency developed as a natural extension of the use of IOUs and banking.