Chapter 4 공책 정리

Chapter 4 공책 정리

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Chapter 4. 4.1 What Is Money? What is money? To economist, money is the stock of assets that can be readily used to make transactions. the dollars in the hands of the public make up the nation’s stock of money The Functions of Money 1. As a store of value, money is a way to transfer purchasing power from the present to the future. 2. As a unit of account, money provides the terms in which prices are quoted and debts are recorded 3. As a medium of exchange, money is what we use to buy goods and services. The Types of Money Dollar bill – fiat money, Money that has no intrinsic value societies gold Gold standard, ‘ ø ‚“ G The Development of Fiat Money Fiat money ,± • “ 1. Reduce transaction cost ø , no one every bother to exchange the fiat money for gold,,,,, everyone values fiat money because they expect everyone else to value it. How the quantity of money controlled? Money supply Monetary policy Central bank Federal reserve Federal Open Market Committee open-market operations—the purchase and sale of government bonds. It is sufficient to assume that the Fed (or any other central bank) directly controls the supply of money How the quantity of money measured? Because money is the stock of assets used for transactions, the quantity of money is the quantity of those assets The most obvious asset to include in the quantity of money is currency, the sum of outstanding paper money and coins A second type of asset used for transactions is demand deposits, the funds people hold in their checking accounts. 4.2 The Quantity Theory of Money
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Transactions and the Quantity Equation T total number of transactions during some period of time, say, a year the number of times in a year that goods or services are exchanged for money P price of a typical transaction—the number of dollars exchanged PT equals the number of dollars exchanged in a year. V
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This note was uploaded on 03/29/2011 for the course ECON 101 taught by Professor Medison during the Spring '11 term at MedU Ohio.

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Chapter 4 공책 정리

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