In explaining the evolution of money
A)government regulation is the most important factor.
B)commodity money,because it is valued more highly,tends to drive out paper money.
C)new forms of money evolve to lower transaction costs.
D)paper money is always backed by gold and therefore more desirable than checks.

Question

Quizplus · Accepted Answer

The evolution of money has been driven by the need to lower transaction costs. As societies became more complex, traditional barter systems became too cumbersome, leading to the development of commodity money such as cowrie shells or beads. Paper money was later introduced as a more convenient and lightweight substitute for commodity money. With technological advancements, digital forms of money such as credit cards and cryptocurrency have emerged to further lower transaction costs. Government regulation and the value of commodity money are also factors, but not as significant as the need to lower transaction costs.

In Explaining the Evolution of Money