It sounds like a simple question, but like a lot of simple questions, this one gets more and more slippery as you try to pin down the answer.
One way to understand money is to ask how people would exchange goods and services without it. Before the invention of money, buying and selling was carried out by bartering, that is, by trading one good or one service for another. Although bartering is simple, it has two important disadvantages compared to using money. First, it is inflexible; second, it does not provide a great deal of incentive for people to increase their productivity. Consider the following example.
Farmer Brown lives in a town with no formal monetary system. Every year, he plants corn in the spring and harvests it in the late summer. At harvest time, he trades his corn for whatever goods and services he can find in his immediate neighborhood.