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The use of money began in the sixth century B.C. in what is now western Turkey, when lumps of gold found in rivers were melted and turned into pieces of uniform size imprinted with a stamp. For almost all of the time since then, the common monetary system has been commodity money, whereby a valuable commodity (typically a metal) is used as a widely accepted medium of exchange. Furthermore, the quantity of money was …

…of the coins too high) or the mint could make unbounded profits by minting new coins and spending them. Similarly, the price level cannot be too high (or the purchasing power of the coins too low), or the mint would make profits by melting down the coins. The absence of arbitrage for the mint places restrictions on the price level, which is contained in an interval determined by the minting point and the melting point