Some types of plastic money include the Canadian dollar, the Romanian leu and the Papua New Guinean kino. These banknotes are made of a polymer that allows for greater security against counterfeiting by creating intricate designs that are difficult to imitate. The first known testing of polymer banknotes occurred during the 1980s, when Canada was developing and evaluating them to replace its previous currency.Know More
As of 2014, polymer banknotes are in full use by Australia, Bermuda, Brunei, Canada, New Zealand, Papua New Guinea, Romania and Vietnam as well as more than a dozen other countries in a limited capacity. Some other countries have released commemorative banknotes that are not used in normal circulation.
Polymer banknotes possess a large number of security features, including windows and the possibility to allow light to shine through them to reveal further security details. The ability to counterfeit these notes is hindered by the complexity of the notes, resulting in notable drops in counterfeiting in those countries that employ them.
The plastic used to create these notes is called "Guardian polymer," serving the specific purpose of use in currency. This polymer allows for shadow images in the form of watermarks, embedded security threads and complex background patterns.Learn more about Economics
Bartering involves exchanging goods or services for other goods and services without involving money. For example, a store owner giving a contractor store credit in exchange for carpentry work is an example of bartering. A baker might bake a cake for his accountant in exchange for services.Full Answer >
A government budget deficit can affect the economy in many ways, most notably it may force the government to print more money to finance the deficit, decreasing the value of the nation's currency. However, running deficits can be beneficial in the short term, as it allows the government to increase GDP and continue to provide the services that allowed it to secure loans from other governments initially, according to About.com.Full Answer >
Inflation can be a problem when it is unexpected or very high, which can result in economic instability and people being afraid to spend money, which hinders economic growth. Furthermore, inflation can make products and services unaffordable to those on fixed-income. It can also cause creditors to lose money and create a negative impact on a country's trade.Full Answer >
Inflation means that the value of money decreases, whereas deflation means that the value of money increases. In a period of inflation, the costs of goods and services increases over time. In a period of deflation, the costs of goods and services decreases over time.Full Answer >