Currency denominations refer to the different values of money that are issued by a government or central bank. These can include coins and banknotes, each representing a specific amount. For example, in the United States, common denominations include pennies, nickels, dimes, quarters, and various dollar bills. Denominations are important for everyday transactions, as they allow people to make purchases of varying amounts. Different countries have their own sets of denominations, such as the euro in the European Union or the yen in Japan, each designed to facilitate trade and commerce within their respective economies.