 What is money?  To an economist, anything that serves as a medium of exchange, unit of account, or a store of value.

Slides:

Advertisements

Similar presentations

Money and the Banking System

Advertisements

Chapter 10 – Money and Banking

Introduction to Macroeconomics

1 Chapter 5 Money and the Federal Reserve These slides supplement the textbook, but should not replace reading the textbook.

Fiscal & Monetary Policy How the Federal Government can Influence the American Economy How the Federal Government can Influence the American Economy.

Unit 13. Money and Banks. The Monetary System IES Lluís de Requesens (Molins de Rei)‏ Batxillerat Social Economics (CLIL) – Innovació en Llengües Estrangeres.

Fiscal and Monetary Policies The Government’s Role In the Economy.

Monetary Policy Multiple Choice Practice

Fiscal and Monetary Policy

Fiscal and Monetary policy

We will be using Cornell Note Taking Format Today! Money Money Money! Money Money Money! One Step at a time to to Success in Economics class!

Vocabulary  Monetary Policy- Conducted by the Fed, involved either the increasing or decreasing the amount of money in circulation.  Fiscal Policy- Involves.

Monetary Policy, Money, International Trade, and the Exchange Rate Shahzad Ahmad Uzair Akhtar Connor Dickson.

Fixing an Economy: Monetary Policy

Fiscal Policy Review - The Payroll Tax Cut FH0 FH0 What does it pay for?

Chapter 10 Money and Banking Money Money is anything that serves 3 purposes: Money is anything that serves 3 purposes: –Medium of Exchange – used when.

Chapter 1 Financial and Economic Concepts 1. Chapter One Objectives 2.

Monetary Policy Review

Copyright © 2001 by The McGraw-Hill Companies, Inc. All rights reserved. Slide Stabilizing Aggregate Demand: The Role of the Fed.

Starter What is a union? Name three kinds of businesses. What is a stockholder? Why would someone choose to go on strike against their employer?

Taxes & Gov’t Spending Fiscal Policy Monetary Policy Potpourri Federal Reserve & More Monetary Policy

Fiscal & Monetary Policy. Warm Up Look at pages 649, and 691 to answer these questions… 1.What is a progressive tax system? 2.How does it help stabilize.

FISCAL AND MONETARY POLICY How do policymakers use fiscal and monetary policy to stabilize the US economy?

Using Policy to Affect the Economy. Fiscal Policy  Government efforts to promote full employment and maintain prices by changing government spending.

Macro Chapter 14 Presentation 2- Expansionary and Restrictive Monetary Policy.

Money Fiat/Legal Tender – money that has value because a government fiat, or order, has established it as acceptable for payment of debts. Medium of Exchange.

Unit 4: Banking Section 2: What affects your $$$.

Monetary Tools. Tools of Monetary Policy  Changing the reserve requirement  Changing the discount rate  Executing open market operations (buying and.

Unit 6: Federal Reserve System and Monetary Policy

How old is Money? Thousands of years, but the first known coin was minted in Turkey around 600 BC (known as the Lydian Lion). What’s it worth? Only around.

Money, Banking, and the Federal Reserve

How effective is monetary policy as an economic tool?

Introduction to Monetary Policy Mr. Way, 2/16/12 CA Standard Understand the aims and tools of monetary policy and their influence on economic activity.

Monetary Policy Control of money supply (M) and interest rates (i)

MONETARY POLICY Conducted by: the Federal Reserve System.

Monetary and Fiscal Policy. How do we promote Economic Growth? Fiscal Policy: Actions done by the government to increase GDP and stabilize inflation Monetary.

Principles of Macroeconomics Lecture 3 MONEY AND COMMERCIAL BANKS CENTRAL BANKING AND MONETARY POLICY.

Jeopardy $100 FEDGOVTAXI RecallI Money $200 $300 $400 $500 $400 $300 $200 $100 $500 $400 $300 $200 $100 $500 $400 $300 $200 $100 $500 $400 $300 $200 $100.

Warm Up See Ms. Nall for handout. Fiscal & Monetary Policy.

Social Studies OGT Review Economics. Types of Economies Command – all economic decisions made by the government Market – business privately owned Mixed.

Banks and Banking October 18, 2011 – Mr. Graboski Aim: What is the Federal Reserve System and what are its functions? Do Now: Write down one question you.

 Fiscal Policy: The use of (Tools):  1. government expenditure (spending)  2. revenue collection (taxation) to stabilize the business cycle.  Who.

The FED and Monetary Policy

Vocabulary  Monetary Policy- Conducted by the Fed, involved either the increasing or decreasing the amount of money in circulation.  Fiscal Policy- Involves.

How does a change in money supply affect the economy? Relevant reading: Ch 13 Monetary policy.

Fiscal Vs. Monetary. Fiscal Policy 1) Taxes and Spending -raise taxes, cut spending -cut taxes and raise spending.

© Mark E. Damon - All Rights Reserved.

Chapter 12 Monetary Policy.

The Federal Reserve System and Monetary Policy. Money Final payment for goods and services Purposes of money: – Medium of Exchange: It can be used to.

Monetary Policy Ch19 Notes. I. Monetary Policy A. Functions of the “the Fed” 1. To keep the money supply in check so that the economy does not have a.

Today’s Topic: Fiscal Policy What is fiscal policy? –The taxing and spending policies of our national government Who controls fiscal policy? –Congress.

 Problems, Policy, and The Fed.  Economic Problems: o Inflation o Loss of wages for workers o Lowered standard of living o Unemployment o Recession.

The Monetary System IMBA Macroeconomics II Lecturer: Jack Wu.

Money and Banking The Federal Reserve and Monetary Policy.

The Federal Reserve System. Prior to 1913, hundreds of national banks in the U.S. could print as much paper money as they wanted They could lend a lot.

Economics Unit 4: Macroeconomics Vocabulary Review.

‘Macroeconomics’ Notes Traverse City West Senior High Introduction To Economics.

What is poverty? Does anyone know how it is calculated Not very clear, the government looks at how much everyone makes, and based on the number of “dependents”

Monetary Policy Tools Describe how the Federal Reserve uses the tools of monetary policy to promote price stability, full employment, and economic growth.

The Fed and Monetary Policy. I. The two main goals of the US Federal Reserve are to: 1. Fight recession – GDP shrinking rather than growing, or unemployment.

Fiscal and Monetary Policy. What it is... Ways the government can try to influence the economy… Expansionary/contractionary.

2nd Nine Weeks Fiscal and Monetary Policy J. Conroy

-How a government taxes and spends money

Federal Reserve Monetary Policy Fiscal Policy Taxes

Expansionary Fiscal Policy Contractionary Fiscal Policy

Money and Monetary Policy

Monetary Policy.

Monetary Policy and the fed

Presentation transcript:

 What is money?  To an economist, anything that serves as a medium of exchange, unit of account, or a store of value.

 Why do you think bartering would not be practical in our economy?  Because money needs to be a… 1. Medium of exchange: Widely accepted by everyone. A teacher does not want to be paid 300 bananas for a days work. Eliminates the need to BARTER

 Money must also act as a… 2. Unit of Account: A means for comparing the value of a good or service. Example: We say money is a “unit of account” because we can use it to compare the price of different items. We don’t have to determine how many shirts are required to buy a car. (PROVIDES A COMMON DENOMINATOR)

 Money must also serve as a…  3. Store of Value: Something that keeps its value of it is stored rather than used.  Example: If you store your money in the bank to save for a car, it is acting as a “store of value”.  Think about it, a bartering economy would be awful if you were trying to store your “money”.

1. Progressive Tax – The percentage paid in taxes increases as income increases (Income tax in the United States). 2. Proportional/Flat Tax – The percentage paid in taxes is the same at all wage levels. 3. Regressive Tax – The percentage paid in taxes decreases as income increases.

1. Diana earns $100k per year and pays $30k in taxes, while Maya earns $50k per year and pays $10k in taxes. What kind of tax is this? 2. Tyriq earns $100k a year and pays $25k in taxes, while Giselle earns $80k and pays $20k in taxes. What kind of tax is this?

Expansionary Policy means we want to increase the money supply. Expansionary Fiscal Policies: 1. Lower Taxes 2. Increase Spending Expansionary Monetary Policies: 1. Lower interest rates (discount rate) 2. Buy Bonds 3. Lower the reserve ratio

 Contractionary Policy means we want to decrease the money supply.  How we use contractionary policy is exactly the opposite of expansionary policy (from last slide).  IMPORTANT LAST VOCAB:  Open-Market Operations – When the Federal Reserve banks buys and sells bonds.