A store manager is analyzing daily amounts for transactions from multiple points of sale in a database. The amounts include fractional values that require precise calculations. Which data type meets these needs for storing monetary amounts?
A floating-point data type that applies binary arithmetic
An integer data type that discards fractional parts
A specialized monetary data type that handles fractional values
A text data type that stores amounts as characters
A currency-specific data type is designed for financial transactions. It preserves decimal precision to prevent rounding issues. Floating-point approaches can introduce inaccuracies because of how binary fractions work. Integer types are not suitable for amounts with fractional components, and text types complicate numeric analysis and validation.
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What are the drawbacks of using text data types for storing monetary amounts?