1. Money and
Banking
Chapter 11

2. --moneyless economy that relies on trade
Barter economy
--moneyless economy that relies
on trade
Do we still barter today??
--of course!

3. Money Medium of Exchange—something accepted
by everyone as payment for G & S.
Money
Measure of Value-
common denominator
that can be used to
express worth
--dollars and cents
Store of Value-
allows purchasing
power to be saved
until needed

4. Characteristics of Money
Portability
--easily transferred
Durability
--should not deteriorate
when being held as a store
of value

5. Divisibility
--divisible into smaller units
Limited Availability
--money loses its value when
there is too much of it

7. National Currency
--there were over 10,000
different currencies from states
--In 1863 the gov’t issued gold certificates
(currency backed by gold) and in 1886
added silver certificates

12. Advantages of the standards:
1. people felt secure
2. prevents the gov’t from printing too
much money
Disadvantages of the standards:
Gold stock couldn’t keep up w/ growth
People could cash their $ in for all of the
gov’ts gold
3. Value of gold is not fixed

13. Take out a dollar bill
if you have one.

17. 10 things about money
things you might not know

18. How is Money Made?
How Stuff Works Website

19. Currency Video Questions
1. What did we use before currency?
2. The first coins were minted around?
3. What is considered currency?
4. Our money is _____money. It has intrinsic value.
5. Bills are made of what two things?
6. How much counterfeit money is in circulation?
7. What is done to combat this?
8. Many European countries use the same currency, the _____________.

20. Currency Video

21. Federal Reserve Bank Video --take your own notes
Modern Banking
Federal Reserve Bank Video
--take your own notes
Three Parts of The FED
and the function of each.