Functions of Money
system of exchange where goods are traded directly for other goods
barter system
idea that money can be divided into smaller units
divisibility
Who created the FED?
Congress
Account with money in the bank that allows
you to deposit and withdraw money
checking account
First and most basic reason to save
Emergencies
anything society uses to purchase goods or services.
money
money can be carried
portability
What is the real name of the FED
The Federal Reserve
a type of card used to make a money transaction to pay for something directly out of your account
Debit Card
Investing and saving for the long term.
Wealth Building
function of money that provides it a "yardstick" to assign values
measure of value
money is strong enough to last
durability
The number of districts that make up the FED
12
type of card that allows a third party to pay for your transaction with the expectation for you to pay it back in the future
Credit Card
How much should you have an your fully funded emergency fund?
3-6 months of living expenses
function that describes the idea that money will retain its value over time
store of value
money will retain its value over time
stability
The responsibility of the FED to manage money supply and interest rates
Monetary Policy
Type of Savings account that restricts the number of withdrawals and puts a minimum limit on each withdrawal.
Money Market
Where should you keep your emergency fund?
Money Market or High Yield Savings Account
the idea that money is more valuable now than in the future
time value of money (inflation)
money cannot be copied
difficulty to counterfeit
What is the name of the insurance that protects your bank account if the money is lost?
FDIC
account or investment where you give the bank your money for a specified period of time and are given interest based on your deposit
Certificate of Deposit
Concept that implies saving up each month BEFORE you pay for something
Sinking Fund