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Unit 3 - Chapter 13 - Macroeconomics Chapter 13 Money Banks...

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Macroeconomics Chapter 13 Money, Banks, and the Federal Reserve System
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It? Money     Assets that people are generally  willing to accept in exchange for  goods and services or for payment of  debts. Asset     Anything of value owned by a  person or a firm.
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The Functions of Money Anything used as money – whether a  deerskin, a cowrie seashell, or a dollar bill –  should fulfill the following four functions: MEDIUM OF EXCHANGE UNIT OF ACCOUNT STORE OF VALUE STANDARD OF DEFERRED PAYMENT
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Barter and the Invention of Money Barter was the primary means of exchange before  money was created. Commodity money replaced barter. Commodity money     A good used as money that also  has value independent of its use as money. Fiat money replaced commodity money. Fiat money     Money, such as paper currency, that is  authorized by a central bank or governmental body and  that does not have to be exchanged by the central bank  for gold or some other commodity money.
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Money In a World War II Prisoner of War Camp 13 - 1 During World War II, cigarettes were used as money in some prisoner- of-war camps.
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What Can Serve As Money? What makes a good suitable to use as a medium of  exchange?  There are five criteria: The good must be  acceptable to  (that is, usable by) most  traders. It should be of  standardized   quality , so that any two units  are identical.
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