Ch.10 Lesson 1
Who manages our money currently?
Federal Reserve System
What year did the federal government force state banks to become part of the National Banking System
1865
How long can banks continue to make loans and deposits?
Until they are unable to
What are the different types of fees?
Application fees, Overdraft fees, Withdrawal fees, Fees for bouncing checks
Paper currency backed by gold
Gold Certificate
What are the characteristics of Modern Money
Portability, Durability, Divisibility, Scarcity
What President Denied the Gold Standard?
FDR
Any system that uses computer and electronic technology instead of checks or paper transactions
Electronic Funds Transfer (EFT)
What did FDR do to strengthen the banking industry?
Announced a bank holiday to prevent bank runs
What is the most visible part of money supply?
Federal Reserve Notes
Moneyless economy that relies; Exchange of goods and services is more difficult due to limited supply of goods
Barter Economy
How much money did Congress authorize to print in 1861 at the start of the Civil War?
$60 million
What can a bank do with extra funds?
Buy U.S bonds
What were pesos nicknamed?
What Act created the National Bank?
National Currency Act
Why and how did Congress start printing paper money?
The Continental Congress issued paper money to finance the Revolutionary War and printed dollars without gold and silver backing.
If banks were in danger of collapsing, what could FDIC do?
Seize the bank, Sell it to a stronger one, Liquidate it and pay off depositors
What is an example of of Making Yourself Creditworthy?
Building a good financial relationship with the bank
Money that has an alternative use as an economic good
Commodity Money
How do you set up a state-chartered bank?
Follow state laws specifying the minimum amount of capital that a founder needs to contribute
Define Medium of Exchange, Measure of Value, Store of Value
Moe - Something accepted by all parties as payment for goods and services
Mov - Money serves as a measuring stick used to express the worth of something in terms that most people understand
Sov - The feature of money that allows purchasing power to be saved until needed.
What did the Gold Standard Act of 1900 do?
Defined a dollar as equivalent to 1/20.67 ounce of gold
How high can interest rates on credit cards get after the grace period passes?
20-25%
How many wampum equal a penny?
6
What is considered evidence that a payment has been made or accepted?
Cancelled checks and electronic records