QUESTION 34. What are the characteristics of ideal coinage system ?
Answer 34. For an ideal coinage system there should be following characteristics :
1. EASY TO RECOGNISE : The coins should be such that , even an illiterate person by holding should able to make out whether the coin is good or bad.
2. CHECK ON FRAUDULENT PRACTICES : The coins should be such that people are not able to make duplicate coins. To prevent fraudulent practices, these days the coins are minted on both the sides.
3. DURABILITY : The coins should be made of good hard metal so that wear and tear is very nominal and due to the fact they are in regular use , the coins should not loose their shape , color and weight.
4. PRECIOUS METAL : The coins should ne made of some precious metal because by that they will have some real value of their own despite their market value.
5 . SHAPE : The shape of the coins should be such that they can be easily carried. If they are very long or heavy then their transportation would be a problem. If the coins are very small then also there would be chances of being lost.
6. PREVENTION FROM CLIPPING : Clipping means cutting off the small particles of the metal from the edges of the coin. The coins should be such that clipping is not possible and the present coins in use have been minted in such a manner that clipping is not possible.