Labor productivity growth
When looking at what makes an economy grow in the long run, it is imperative to begin by examining how output is created.
Firms use a combination of labor and capital to produce their output. Labor consist
Functions of Money
Try to imagine an economy without money. Without money, it would be almost impossible to carry out the usual day to day
business of life. For instance, if you wanted to buy a hamburger without cash, you would have to give the restaurant
The real gross domestic product (GDP) growth rate since 1970 has averaged around 3% per year. Over the last 30 years
this corresponds to a 242% increase in the real GDP. The economy has clearly grown during this period. Interesting
Purpose of Banks
Business of banks
What do banks do? We know that most banks serve to accept deposits and make loans. They act as safe stores of wealth
for savers and as predictable sources of loans for borrowers. In this way, the major business of banks
What is the major service provided by banks?
The primary role that banks serve is that of financial intermediary. Banks bring together savers and borrowers and make the
financial markets work.
What happens when you deposit mon
Which of the following is the best example of bartering?
(A) Trading a dozen apples for a piece of steak
(B) Purchasing a piece of steak with cash
(C) Charging a dozen apples on a credit card
(D) Growing a dozen apples
Which of the following i
Which of the following do banks not do?
(A) Print money
(B) Make loans
(C) Take deposits
(D) Invest money
When you give money to a bank, you are what?
(A) A borrower
(B) A lender
(C) A depositor
(D) A withdrawer
How much does the FDIC insure individu
Problem : Describe the basic functions of money.
There are four basic functions of money. First, money is a medium of exchange. Buyers use a medium of exchange to
compensate sellers in exchange for goods and services. Second, money is a unit of a
Introduction and Summary
You work after school and earn $200 per week. On payday, you take your check to the bank and cash it. You put part of the
money in a savings account and you put the rest in a checking account. After a number of months, you