Final Review

Final Review - FinalReview 03:52

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Final Review 03:52 1. Are credit cards and debit cards money? What is the difference between credit  and debit cards? Neither credit cards nor debit cards are money, but credit cards are very different  from debit cards. Credit cards are not a medium of exchanges, but a means of  deferring payment. Debit cards allow  2. What is the difference between commodity money and fiat money? Why do  people accept fiat money in trade for goods and services? Commodity money has “intrinsic value” or value in uses other than money.  Fiat money is established as money but the government. It has very little, if  any, intrinsic value. Although fiat money has no intrinsic vale, people accept it  in trade when they are confident that others will also accept it. The  government’s decree that fiat currency serves as legal tender increase this  confidence. 3. If the reserve ratio is 20%, how much money can be created from from $100 of 
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This note was uploaded on 04/20/2011 for the course ECON 20B taught by Professor Hymel during the Spring '08 term at UC Irvine.

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Final Review - FinalReview 03:52

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