Agenda
• Test #2
• Introduction to Module 3, Money and Banking
• Homework
– Review Powerpoint for next class (online)
– Read “Current Reading Assignment” (online)
• Test #2
– Five Minute Review
– Remain Quiet
• OR DETENTION AWAITS YOU
– TEST ENDS @
Cheating
According to the La Salle Student
Handbook & Planner, an option
available to a teacher that discovers
a student cheating is to fail the
student for the class. This is the
option that I will choose if you cheat
on the test.
THREE MINUTE BREAK
http://www.onlinestopwatch.com/bomb-countdown/
Introduction to Module #3
Money and Banking
Before there was money, barter was
the system.
Bartering is trading goods and services.
Example…I’ll teach you if you if wash my
car.
No money exchanged,
just an exchange of services
Not efficient
So Money evolved.
Three Uses of Money
1. Medium of Exchange
Buy Stuff
2. Store of Value
Retains Value
(what is the value of money anyway?)
3. Unit of Account
Measures stuff
(what is the value of your backpack?)
Six Characteristics of Money
1.
2.
3.
4.
5.
6.
Portable – You can take it with you
Uniform – Your dollar bill is the same as mine
Durable – Lasts a long time (survives the
washing machine)
Divisible – You can make change
Limited – Can’t be counterfeited
Accepted – Stores accept your paper
Why these characteristics?
Because these six characteristics
achieve the three uses of money.
Characteristics
1. Portable
2. Uniform
3. Durable
4. Divisible
5. Limited
6. Accepted
Uses
1. Medium of Exchange
2. Store of Value
3. Unit of Account
Four Types of Money
1. Commodity Money
(ex. shells, gold, salt, sheep)
2. Representative Money
(paper money representing a commodity)
3. Fiat Money
(paper money not representing a commodity)
4. Electronic Money
(paperless money)
Four Types of Money
1. Commodity Money
2.
(ex. shells, gold, salt, sheep)
Representative Money
(paper money representing the commodity)
3.
Fiat Money
4.
Electronic Money
(paper money not representing a commodity)
(paperless money)
Why the evolution ….
from commodity
to representative
to fiat
to electronic?
Because each successive type
has more of the six characteristics
to achieve the three uses.
Types
1. Commodity
2. Representative
3. Fiat
4. Electronic
Characteristics
1. Portable
2. Uniform
3. Durable
4. Divisible
5. Limited
6. Accepted
Uses
1. Medium of Exchange
2. Store of Value
3. Unit of Account
HOMEWORK
• Review Powerpoint for next class (online)
• Read “Current Reading Assignment” (online)