4.1
4.2
4.3
4.4
100
What trading service would be use if there was no money?
Barter
100
What is the main difference between M1 and M2 money supply?
Liquidity
100
_______ = Liabilities + Equity
Assets
100
What is the main form of revenue for banks?
Interest from loans
200
What type of money has no value?
Fiat Money
200
Which category of money supply includes the other plus other assets?
M2
200
What is an intermediary?
Someone who connects two parties
200
What is the term of what the bank can’t loan out?
Reserve Requirement
300
Double Coincidence of Wants is what?
Situation in which two people each want some good or service that the other person can provide.
300
Why is money supply split into different categories?
Because money supply is complex and must be split in order to calculate its total.
300
How Do Banks Go Bankrupt?
A negative net worth, meaning its assets will be worth less than its liabilities
300
What is a Mattress Economy?
An economy that doesn’t trust/deposit into banks
400
What American writer wrote in 1911, money is a “blessing that is of no advantage to us accepting when we part with it.”
Ambrose Bierce
400
Which M categories are most important and most used?
M1 and M2
400
Why was the robber wrong about the money being in the banks?
Majority of money in the economy is not in the form of currency sitting in vaults or drawers at banks, Most money is in the form of bank accounts, which exist only as electronic records on computers
400
What is the difference between physical and digital currencies?
Not all digital currency is backed
500
Which type of money is valued with gold or silver held at a bank?
Commodity Money
500
What is liquidity?
How quickly you can use a financial asset to buy a good or service.
500
What was the name of the robber on the first slide?
“Manhattan Flash”
500
What is the formula for Money Multiplying?
1/Revenue Requirement X Remaining $
