What is a medium of exchange? Why is it important?

A medium of exchange and why it's important
Medium of exchange refers to any item that is widely acceptable and used in exchange of goods and services. Medium of exchange acts as a stimulus for increasing trading-related activities. The most common and generally accepted medium of exchange in the modern economy is money which is represented as currency. A medium of exchange should have the following properties; consistent intrinsic value, be interchangeable, transportable, reliable, has real value and be widely accepted. Money is commonly used as the primary medium of exchange, but there are also other items of value such as gold, stones and salt that are also considered mediums of exchange. 

The most important purpose of a medium of exchange is to provide a way to facilitate exchanges by purchase or sale. The processes of exchange are conducted through medium of exchange because all parties involved understand the value of the medium. In other types of exchange methods, such as barter trade or trade with certain non-monetary objects, some parties may be unable to determine the value of the item being exchanged when a consistent medium is absent.