Functions & Types of Money
Trading a chicken directly for a bag of wheat without using cash
bartering
This payment card deducts funds directly from your checking account instantly
debit card
The central bank of the United States, established in 1913
Federal Reserve (or The Fed)
To slow down spending and fight high inflation, the Fed will do this to interest rates
Raise
Where did Mr. Seppi go to College?
UT Tyler
Money whose value comes from the physical material it is made of, like gold or animal furs
commodity money
This payment card uses borrowed bank money that you must pay back later
credit card
The group located in Washington D.C. run by presidential appointees who oversee the Fed system
Board of Governors
To encourage spending during a recession or high unemployment, the Fed will do this to interest rates
lower (or decrease) them
Who is Mr. Seppi's girlfriend?
Ms. Thompson
U.S. paper money used to be backed by gold, making it this type of money
representative money
Paying only this small required amount each month on a credit card keeps you in long-term debt
minimum payment
The interest rate the Fed charges commercial banks to borrow money directly
discount rate
When the Fed buys government bonds on the open market, the money supply does this
expands (or increases)
What is Mr. Seppi's favorite artist?
Deftones
Today’s U.S. dollar has value simply because the government declares it does, making it this type of money
fiat money
Peer-to-peer apps like Venmo or Zelle carry a higher risk of this compared to credit cards
fraud (or scams)
The percentage of cash banks are legally required to keep in their vaults rather than lending out
reserve requirements
Lowering reserve requirements allows banks to keep less cash in vaults, causing lending to do this.
increase
What's Mr. Seppi's favorite fast food?
Chipotle or Taco Bell
The general rise in prices over time that reduces your money's purchasing power
inflation
This 3-letter acronym represents the yearly interest rate charged on unpaid credit card balances
APR (Annual Percentage Rate)
The Federal Reserve System divides the nation into this specific number of regional district banks
12
Buying and selling government treasury bonds to adjust bank cash is called these kinds of operations
Open-Market Operations
What is Mr. Seppi's zodiac sign?
Aries