The currency accepted in Japan is Japanese Yen. Cash is typically the best way to pay for things, but electronic payment methods (such as debit or credit cards) are becoming more commonly accepted.
When landing at the airport, it is a good idea to get a travel card (IC Card) such as SuICa, as they can be pre-loaded with money and make payments with ease for public transportation and vending machines.
Note: Tipping and haggling are not practiced in Japan — what you see is what you pay.
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