1. Chapter 14 Review
Money and Banking

2. Vocabulary Terms Bank Holding Company Legal Reserves State Bank
Member Bank Reserves
Discount Rate
Reserve Requirement

3. Vocabulary Terms Silver Certificate Fiat Money Medium of Exchange
Federal Reserve Notes
Barter Economy
Legal Tender

4. Concepts Money Easy Money Policy As an economic good.
Determining value
Defined
Types and characteristics
Easy Money Policy
What is it?
How does it effect the economy?

5. Concepts FOMC Federal Reserve What does it do? Its purpose?
How the FED effects interest rates.
What is its organization/makeup/structure
When was it established?
Why?

6. Concepts FDIC Continental Currency M1 M2 What is its purpose?
Why it was needed?
Continental Currency
What is the historical significance? M1 M2

7. Chapter 14 – 1 Visual
Page 409

8. Chapter 14 – 2 Visual
Page 409

9. Chapter 14 – 2 Visual
Page 395

10. Chapter 14 – 3 Visual
Page 405

11. Chapter 14 – 3 Visual
Page 400

12. Essay
Are supply and demand curves useful for determining how a change in monetary policy will impact interest rates in the short run? Explain
Graphs on page 402

13. Essay
Using the reserve requirement, the Federal Reserve wants to slow economic growth. How would the FED accomplish its goal? Explain what the effect of this action would have on consumers.

14. Essay
Explain why is it important for money to be portable, divisible, durable and in limited supply? What effect, if any, would this have on the economy if these characteristics were not present?

15. Essay
Using the situation given, what would be the impact on consumers if the FED action describe was taken?