Define Medium of Exchange

Define Medium of Exchange

Medium of exchange is the second function of money which implies with the fact that money serves as such a thing that is acceptable to everyone in exchange to any type of services or goods. In ancient times people used to exchange services or goods against many generally acceptable items like cowry shells, cattle’s, tortoise shells and so on which has been changed with the passage of time. Money, in recent form, has minimized the time and effort spent in the barter system of exchange. In this way money had eased the trading conditions as every good or service can be exchanged with money and getting maximum benefit out of it.