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Unit v money
- 1. Qualities of Money • Stability • Portability • Durability • Uniformity • Divisibility • Recognizability
- 2. Stability •Value does not fluctuate a great deal
- 3. Recognizability •Hard to copy but easy to recognize
- 4. Portability •Small and light enough to carry with you
- 5. Durability •It lasts for a long time
- 6. Uniformity •Denominations have the same value across the board
- 8. What money does • Eliminates the double coincidence of wants •You must find someone who wants what you want and will trade for what you have.
- 9. Functions of money • Medium-of-exchange • Store-of-value • Standard-of-value
- 11. Standard-of-Value • Simplifies price comparisons • Agreed to measure for stating prices
- 12. Store-of-Value •Permits money to be held for use at a later time
- 14. Currency •Paper money and coins •Also known as Fiat money •Has value because the government says it does
- 15. Checkable Deposits •Can make withdrawals and payments by check •Savings •Credit Unions
- 16. Travelers Checks •Duh!! It’s a travelers check!
- 17. Sources of Money’s Value • Representative Money • Item that has value because it can be exchanged for something valuable • Commodity Money • An item that has value of its own and is used as money
- 20. M2 •M1+Money Market Accounts, Savings Accounts, Mutual Fund Accounts