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ECON102 Lecture Notes - Lecture 4: Mortgage Loan, Deposit Account, Demand Deposit

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cerisegiraffe538
13 Feb 2018
School
University of Waterloo
Department
Economics
Course
ECON102
Professor
Mergo Teferi

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ECON102 Full Course Notes
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Document Summary

Money, the price level, and inflation (chapter 24) Money is any commodity or token that is generally acceptable as a means of payment. A means of payment a method of settling a debt. Money has three other functions: medium of exchange, unit of account, and store of value. Money acts as a medium of exchange an object that is generally accepted in exchange for goods and services. In the absence of money, people would need to exchange goods and services directly, which is called a barter. Barter requires a double coincidence of wants both people need to coincidentally want an item, which is hard to achieve. Money acts as a unit of account an agreed measure for stating the prices of goods and services. Also acts as a store of value money can be held for a time and later exchanged for goods and services (money can hold its value) Money in canada consists of currency and deposits.

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Related Questions

Anything that is generally acceptable in trading for goods and services is a:

a) medium of exchange

b) store of value

c) token money

d) measure of value

Money eliminates the need for a coincidence of wants in trading primarily through its role as a:

A. Unit of account.

B. Medium of exchange.

C. Store of value.

D. Medium of deferred payment.

1. To say money is socially defined means that:

A) the money supply includes all public and private securities purchased by society.

B) whatever performs the functions of money extremely well is considered to be money.

C) society, acting through Congress, specifies what shall be included in the money supply.

D) money has been defined in a Constitutional amendment.

 

2. Money functions as:

A) a medium of exchange.

B) a store of value.

C) a unit of account.

D) all of these.

 

3. If you are estimating your total expenses for school next semester, you are using money primarily as:

A) a store of value.

B) an economic investment.

C) a unit of account.

D) a medium of exchange.

 

4. If you place a part of your summer earnings in a savings account, you are using money primarily as a:

A) medium of exchange.

B) store of value.

C) standard of value.

D) unit of account.

 

5. If you write a check on a bank to purchase a used Honda Civic, you are using money primarily as:

A) a store of value.

B) a medium of exchange.

C) a unit of account.

D) an economic investment. 

 

6.  A $70 price tag on a sweater in a department store window is an example of money functioning as a:

A) standard of deferred payments.

B) medium of exchange.

C) unit of account. 

D) store of value.

 

7. Stock market price quotations best exemplify money serving as a:

A) index of satisfaction.

B) store of value.

C) medium of exchange.

D) unit of account. 

 

8.  Purchasing common stock by writing a check best exemplifies money serving as a:

A) medium of exchange. 
 
B) unit of account.
 
C) index of satisfaction.
 
D) store of value.