Objective Sheets Chapter 21 & 22

Objective Sheets Chapter 21 & 22 - Asch Hawthorn...

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Asch Hawthorn Economics T-Th A. Ordonez 809-195-3K1C 4/27/10 Chapter 21 Define the Following Money - is the set of assets in an economy that people regularly use to buy goods and services from other people. Medium of Exchange - A medium of exchange is an item that buyers give to sellers when they want to purchase goods and services. A medium of exchange is anything that is readily acceptable as payment. Unit of Account - A unit of account is the yardstick people use to post prices and record debts. Store of Value - A store of value is an item that people can use to transfer purchasing power from the present to the future. Demand Deposits - are balances in bank accounts that depositors can access on demand by writing a check. What distinguishes money from other assets in the economy? It does not have intrinsic value. Examples: Coins, currency, check deposits. What is commodity money? what is fiat money? which kind do we have? commodity money : Commodity money takes the form of a commodity with intrinsic value. Examples: Gold, silver, cigarettes. fiat money is used as money because of government decree. It does not have intrinsic value. Examples: Coins, currency, check deposits. And we have the fiat money type.
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Asch Hawthorn Economics T-Th A. Ordonez 809-195-3K1C 4/27/10 Who is responsible for setting monetary policy in united states? How is this group chosen? The Federal Open Market Committee (FOMC)
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This note was uploaded on 05/10/2010 for the course ECONOMICS 809-195-3K taught by Professor A.ordonez during the Spring '10 term at Gateway Tech.

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Objective Sheets Chapter 21 & 22 - Asch Hawthorn...

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