1. Banking, Currency & the Fed

2. I) Banks A) Banks loan money to investors who create more wealth. B) Investors pay back the loan plus interest C) Savings rate is declining D) Too much money spent in the economy doesn’t allow for investment.

3. II) Federal Reserve & Currency A) The black #, one inch from the corner is the fed district the dollar was made in. B) This number will correspond to the letter just to the left of the president. C) The serial number on either side allows the government to keep a record of all the currency. D) Currency is less than 10% of all money/near $

4. Federal Reserve Con’t E) Federal Reserve regulates the US banking system to prevent collapse F) Controls money supply G) Monetary policy H) Fiscal policy –1) Taxes are leakages –2) Spending is injection