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Money: assets that can easily be used to buy things (dollar bills) Wealth: The accumulation of assets |
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| The set of assets in an economy that people regularly use to buy goods and services from other people |
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| an item that buyers give to sellers when they want to purchase goods and services. |
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| Barter is problematic because of the problem of... |
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| double coincidence of wants |
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| What solves the double coincidence? |
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| the yardstick people use to post prices and record debts. |
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| an item that people can use to transfer purchasing power from the present to the future |
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| Why is money an imperfect store of value? |
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| Money loses value during times of inflation. |
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| The ease with which an asset can be converted into the economy's medium of exchange. |
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| what is the most liquid asset? |
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| money that takes the form of a commodity with intrinsic value. ex: gold coins. |
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money without intrinsic value that is used as money because of government decree.
ex: our dollars in the U.S. |
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| The quantity of money circulating in the United States |
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| The paper bills and coins in the hands of the public. ex: "in circulation" |
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| balances in bank accounts that depositors can access on demand by writing a check |
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| measurement of money containing the most liquid items. ex: currency, demand deposits, traveler's checks. |
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