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Recently, Iran decided to replace its old currency to a new one.

Quoted from Wikipedia

A proposal has been agreed to by the Iranian parliament to drop four zeros, by replacing the rial with a new currency called the toman

I have started studying basics of economics very recently. And I assumed the previous and new situations to be something like:

Imaginary Situation 1

Value of each coin = $1
Total coins = 1000
Value = $1000

Imaginary Situation 2

Value of each coin = $10
Total coins = 100
Value = $1000

Since, there are less number of coins it might be easier to perform transactions. That's my assumption of the possible benefits of this scheme.

Question:

  1. Is the assumption correct?

  2. Any other benefits of such a scheme?

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  • $\begingroup$ Doing this in the US would make no cents! $\endgroup$ – Hot Licks Mar 3 at 1:13
  • $\begingroup$ Note that the US half-cent coin was discontinued in 1857. The value of the coin then was equivalent to about $0.15 today. $\endgroup$ – Hot Licks Mar 13 at 23:11
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Instead of the word "benefit" I prefer to use the old Saxon word "bebebebebebebebebebenefit". Some people say using the shorter word has bebebebebebebebebebenefits, but I don't see any.

P.s.: coins and notes of extremely small value are usually removed from circulation. It is unlikely the average person would ever pay with 1000 coins.

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    $\begingroup$ bebebebebebebebebelaugh out loud. $\endgroup$ – user253751 Mar 2 at 11:52

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