EC 151 Ch 16

EC 151 Ch 16 - EC 151 Ch: 16 EC 151 Ch: 16 The Monetary...

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Unformatted text preview: EC 151 Ch: 16 EC 151 Ch: 16 The Monetary System The Monetary System The meaning of money The meaning of money The FED The FED Banks and the money supply Banks and the money supply Agenda Agenda What money is? What money is? Forms that money takes Forms that money takes How the Banking system helps create money How the Banking system helps create money How the government controls the Q of money in How the government controls the Q of money in circulation circulation How changes in the Q of money affect various How changes in the Q of money affect various economic variables (inflation, IR, production, economic variables (inflation, IR, production, employment) employment) The meaning of money The meaning of money Money: Money: the set of assets in the economy that people the set of assets in the economy that people regularly use to buy goods and services from other regularly use to buy goods and services from other people people money includes only those few types of wealth that money includes only those few types of wealth that are regularly accepted by sellers in exchange for are regularly accepted by sellers in exchange for goods and services goods and services The functions of money The functions of money The 3 functions The 3 functions of money: of money: medium of medium of exchange exchange a unit of account a unit of account store of value store of value liquidity liquidity Cash in the Hands of the Public ($586 billion) Demand Deposits ($330 billion) + Other Checkable Deposits ($260 billion) + Travelers Checks ($8 billion)...
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EC 151 Ch 16 - EC 151 Ch: 16 EC 151 Ch: 16 The Monetary...

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