3 Money - What is Money Prof Irina A Telyukova UBC...

Info icon This preview shows pages 1–5. Sign up to view the full content.

View Full Document Right Arrow Icon
What is Money? Prof. Irina A. Telyukova UBC Economics 345 Fall 2008
Image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
2 In order to understand the role of money in the economy, we first have to know what we mean by the word. Defining it precisely, and measuring it, is important – and a non-trivial task. We look at the basic characteristics of what makes an object money. Outline
Image of page 2
3 An object is called money if it can be used in payment for goods and services, payment of taxes, or repayment of debts. An exception: credit cards fit all of those definitions, but are not considered money by economists (the are instead counted as debt). Money is NOT the same as wealth. Money is NOT the same as income. What do we mean by “money”?
Image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
4 A medium of exchange Barter is hard: double coincidence of wants. A medium of exchange helps overcome frictions between buyers and sellers (i.e. LACK of double coincidence of wants; anonymity) – that is, a reduction in transaction costs. Good medium of exchange is: recognizable/widely accepted; divisible; portable; durable.
Image of page 4
Image of page 5
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern