“Money is the lifeblood of the economy” Explain this quote. How does money keep the economy moving? What happens to our economy when people have less money?

Money Essential Question: How did modern monetary systems evolve from primitive barter economies?

Barter Economy – a moneyless economy that relies on trading goods & services for other goods & services * In order for the exchange to take place, there must be a “mutual coincidence of wants”

Money – anything that all (or most) of the people of a society are willing to accept as payment for goods and services Island of Yap Stone Disks (known as Rai) Colonial America Buckskins Native Americans Wampum

In Ancient Rome, soldiers were paid in salt Salarium → “Salary”

Commodity Money vs. Fiat Money Federal Reserve Notes are backed by the "full faith and credit of the U.S. government"

Functions of Money Serve as a “Medium of Exchange” Serve as a “Measure of Value” Serve as a “Store of Value”

Characteristics of Money Must be Portable Must be Durable Characteristics of Money Must be Divisible Must be Limited in Availability

Continental Dollars

Bank Notes

United States Note (AKA “Greenback”) Confederate States of America Note

National Bank Note

1922 Gold Certificates

$10 “Indian Head” Gold Coin (1932) $20 “Saint-Gaudens” Gold Coin (1914)

Silver Certificate 1899 Silver Dollar

http://www. nydailynews http://www.nydailynews.com/news/national/family-wins-back-seized-gold-coins-worth-80m-article-1.2189743

Silver Certificates

1978 Silver Dollar

Federal Reserve Notes

U.S. Bureau of Printing & Engraving http://www.moneyfactory.gov/ Video Clip U.S. Mint http://www.usmint.gov/index.cfm?flash=yes Video Clip

Money Summarizer: How does the currency (paper and coin) currently used in the United States of America fulfill the functions and characteristics of money? Functions on Money: Medium of Exchange Measure of Value Store of Value Characteristics of Money: Portable Divisible Durable Limited in Availability