Notes

1.Which period is known as the Age of Discovery in Europe? Why?
Ans: Explorers from many European countries such as Italy, Spain, and England etc. journeyed from Europe across the four oceans and discovered lands and cultures that were new to them. This period of history is called the age of Discovery in Europe.


2.How did the Renaissance help the European economy?
Ans: During the renaissance there were developments of new farming technology, new mechanical processes, and new weapons for warfare. Farms were more productive, which helped the European economy grow stronger. Trade routes were expanded, along with a higher demand for resources. This led to a more sophisticated and stable financial and banking system in Europe.


3.Gold is a symbol of wealth and value throughout human history. How did gold become as a medium of exchange in Europe?
Ans: Throughout the European history, Gold has been a symbol of wealth and value. It's almost magical appearance made it a valuable commodity. So, it was natural to use it as a medium of exchange. Around 4000 BCE, Egyptians started making gold bars to use as a money. They measured and weighed their gold to give it a consistent value. Over time as trade developed, gold coins began to be used by. It was easier to carry and could be made into different values.


4.The increase in trade came an increase in the need for currency in the Europe. Explain about it. (Explain the flourishment of gold trade.)
Ans: Trade and commerce flourished during the age of discovery. Within two hundred years, Europeans had explored, mapped and established trade routes all over the world. With this increase in trade came an increase in the need for currency that could be used everywhere.


5.In ancient times people used gold coins as a currency. However nowadays people are used to light coins and currency notes. Justify the statement. (Explain the economic issues involved with using gold as currency).
Ans: For over a hundred years, gold and silver coin had been used as a currency. However, coins were difficult to produce. The gold and silver had to be mined from the ground and then melted into the shapes of coins. This took a lot of hard works and effort. Coins were heavy and difficult to travel with.


6.Explain the major problems with gold coins in ancient times.
Ans: There was an even bigger problems with coins. They could be “devalued”. For example, a gold coin should be made entirely from gold. But people sometimes make gold colored coin that only contained less gold and spend it as if it were 100% gold coin. One solution to this was to stamp each coin with a symbol or picture, usually the face of the king. This would allow traders and merchants to verify that the coins were genuine.


7.Write about paper money?
Ans: Paper money was first used in China in 816 CE.The Chinese and then the Mongols used paper money as a medium of exchange for about 500 years. It was also tested in Persia in 1294 CE.It all started with the Persian king giving paper money to his citizens.