Value
Jake puts $500 under his mattress to save it for next year. Which function of money is he using?
Saving money is not a function of money
Medium of exchange, Unit of account
Store of value
Store of value—keeping money so it keeps its worth over time
Which of the following is an example of an asset?
A car you own
These are examples of what type of money
Tobacco, shells, salt, cattle, metals
Commodity Money
You can carry $100 in your wallet instead of carrying 100 pounds of goods to trade. Which characteristic of money is this?
Durable, Portable, Uniform, Divisible
Portable—money is easy to carry and transport
Mark has a $10 million house but owes $8 million in loans. Sarah has $2 million in savings and no debts. Who is wealthy?
Sarah is wealthy because she has money available after paying all debts
A $1 bill looks the same and has the same value whether you use it in New York or California. Which characteristic is this?
Uniform—all money of the same value looks and is worth the same
What is debt?
What you owe
Which type of money has value because the government says it does, even though it is not backed by gold?
Fiat money—currency that has value by government decree
Money needs to last a long time without breaking or falling apart. Which characteristic is this?
Durable—money can be used many times without wearing out
Which is a need rather than a want?
Coat
Candy
Hibachi
Dior
Coat
A store displays a shirt with a price tag of $25. Which function of money does this price tag show?
Unit of account—measuring the value of goods
Owning a house is ______________Mortgage is ____
Asset Debt
What is passive income?
Mailbox money, money not actively working for at the time.
Kee wants a new pair of shoes but is saving money for her car. instead of buying the shoes today she waits until she reaches her savings goal.
What is this demonstrating
Delayed gratification
Wealthiest Person in America
Elon Musk
Maya buys a sandwich at lunch using money. Which function of money is she using?
Medium of exchange—using money to trade for goods
A person has total assets worth $500,000 and owes $200,000 in debts. What is their net worth?
300,000
A bank gives you a piece of paper that says ‘This note can be exchanged for gold.’ What type of money is this paper?
Fiat, Commodity, Representative
Representative money—paper or coin representing a valuable good
Jamal can buy concert tickets or put the money towards a new laptop. He chose the concert tickets. The money towards a new laptop is the trade off or opportunity cost?
Opportunity cost- The next best thing is the money towards the laptop.
CEO of facebook?
Mark Zuckerberg
A restaurant lists items on the menu with prices: burger $8, salad $7, soda $3. What function of money does this menu show?
Unit of account—comparing the values of different items
Taylor owns a car worth 18,000 but still owes 12,000 on the car loan.
Is it asset or debt or both? Explain
Car is asset loan is debt
In the past, people used shells and salt as money because these items were valuable to trade. What type of money is this?
Commodity money—money made from a good that has actual value
Gold is valuable partly because there is only so much gold on Earth. Which characteristic of money is this?
Limited in supply—there is only a certain amount available
Jordan has 600 saved. His game system broke. He wants a new system that is on sale. His car needs a 350.00 tune up so he can get to work. Identify his need and wants
Wants: get a new system
Needs: get car repaired