Econ. Chapter 10

Medium of exchange

A means through which goods and services can be exchanged

What did the National Banking Act of 1863 set up?

A system of national banks and national currency

Money

Anything that people will accept in exchange for goods and services

The difference between credit cards and debit cards is that

Credit cards are loans, while debit cards are withdrawals of exisiting funds

For what purpose was the First Bank of the United States created?

Issue a national currency, control the money supply, and lend money

Commodity Money

Money that has intrinsic value based on the material from which it is made

Representative Money

Money that is backed b something tangible

Fiat Money

Money that is declared by the government to have worth

Currency

Paper money and coins

Near Money

Savings accounts and time deposits that can be converted into cash relatively easily

Store of value

Something that holds its economic worth over time

Barter

The exchange of goods and services without using money

Standard of value

The measurement of economic worth in the exchange process

What is the purpose of the Federal Reserve System?

To make loans to banks, issue currency, and and regulate the money supply