My Notes

Unit 3 The M geniustary Sector Objectives ?Define gold and explain the requirements of capital ? detect the functions of money ?Discuss the functions of a central bank and commercial banks ? take in the money creation process ?Explain how the supply of money and the subscribe to for money ar determined ?explain the instruments of monetary policy Definition of coin silver is anything that is generally acceptable in exchange for goods and go. patronage Economies Barter is the direct exchange of one good for a nonher without development money as characterless of exchange. If people want to trade, thither has to be a trope coincidence of wants. This means on that point is a quest to find a match amidst what each of the two traders wants to control and what each wants to offer in exchange. Barter is a cartridge holder consuming process and not suitable for a novel economy where a big range of goods and operate are produced. Requirements of Money Object s that we can use as money should pair the following requirements: ?General acceptability: It should be desired and current by all as medium of exchange. ?Durability: Money changes hands all the time and and then it should not die easily. ?Manageability: Its mass should be delicate relative to its rank, i.e. it must be portable.

?Homogeneity and divisibility: The various denominations of a currency should be made of the same material and grammatical construction the same. ?Recognisability: It should be easily recognizable and distinguishable from other materials. ? apprize: It should be limited in supply because the relative scarcity of a currency determines its o bserve. ?A relatively fixed value: Its va! lue should be fairly constant. Money loses its value and get role due to inflation. Functions of Money Money has several basic functions in the economy. These functions distinguish money from other assets such as stocks and bonds. ? enduringness of exchange: We offer money in exchange for goods and services and it makes this exchange...If you want to get a full essay, order it on our website: OrderEssay.net

If you want to get a full information about our service, visit our page: How it works.