2 - Banking Homework: Unit 2 :Conceptual Problems Describe...

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Banking Homework: Unit 2 Conceptual Problems : Describe at least 3 ways you could pay for your morning cup of coffee. What are the advantages and disadvantages of each ? 1 - Cash This may be the easiest choice because of the liquidity of cash, but some disadvantages include risking theft of cash  . 2 - Credit Card This is the second best way to pay for something, because of its general acceptance, but is less liquid than cash, and may not be accepted 3 - Check This is the third best way that can be used to pay, it is generally acceptable but in fewer locations than credit card, and some small shops may not accept it  . Explain how money encourages specialization, and how specialization improves everyone’s standard of living . Without money, workers and other resources could not be paid except in the output produced. All those who participated in the production of the good would have to collectively exchange it for all the goods and service desired by the resource owners . Specialization improves standard of living by Comparative advantage. It is the ability to produce a good at a lower cost, relative to other goods, compared to another country. In the Principles of Economics, it states comparative advantage is a specialization technique used to create more efficient production and describes opportunity cost between producers. With perfect competition and undistorted markets, countries tend to export goods in which they have a comparative advantage ("Comparative Advantage .(" As of March 2007, 13 of the 27 countries of the European Union have adopted the euro. The remaining 14 countries, including Great Britain, Denmark, and Sweden have retained their own currencies. What are the advantages of a
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2 - Banking Homework: Unit 2 :Conceptual Problems Describe...

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