What does the term "flying cash" refer to in historical trade?

The term "flying cash" refers to a system of paper money used in ancient China that greatly facilitated trade by allowing merchants to conduct transactions without the need to carry large amounts of physical currency. This innovation emerged during the Tang dynasty and became more prominent in the Song dynasty, promoting economic growth and making long-distance trade safer and more efficient. By using promissory notes that could be exchanged for coinage at different locations, merchants could effectively manage their finances and engage in greater commerce, thus enhancing the market economy of the time.

The other options do not accurately reflect the specific concept of "flying cash." The trading of physical goods without currency implies a system of barter, which does not involve the use of money at all. While currency exchange does happen in Europe, it is unrelated to the specific mechanism being described by flying cash. Lastly, a method of bartering goods focuses on direct trade of items rather than utilizing a form of currency, which does not apply to the concept of flying cash that emphasizes the role of paper currency in trade.