1. 5/7 Warm-Up Pass up p. 266 for me to check. 1.What are the two ways a stockholder can make money? 2.What are the two most important measures of the stock market? Bonus ? Secretary of State Kerry is meeting with which foreign leader today to discuss the conflict in Syria?

2. Honors What’s wrong with this sentence? “Self-interest because it talks about how we only care about ourselves.” Citizenship Project Remember all pre-approvals are due by Friday!

3. Labor p. 266

4.  Productivity – the value of output

5. Types of Labor  Unskilled labor – requires no specialized skills, education or training  Ex. dishwashers, many factory workers, janitors, farm workers  Semi-skilled labor – requires minimal specialized skill and education  Ex. short order cooks, some construction workers, lifeguards  Skilled labor – requires specialized abilities and training to do tasks.  Ex. mechanics, bank tellers, plumbers, firefighters, chefs, carpenters  Professional labor – demands advanced skills and education.  Ex. managers, teachers, bankers, doctors, lawyers, actors, computer programmers

6. Wage Discrimination  Occurs when people with the same job, same skills and education, same job performance, and same seniority receive unequal pay. Women and minorities are among those who have experienced wage discrimination.

7. Ways to Protect Workers  Labor Unions – an organization that tries to improve working conditions, wages, and benefits for its members  Strike – organized work stoppage intended to force an employer to address union demands

8. Ways to Protect Workers  Right-to-work laws – this is a measure that bans mandatory union membership. NC is a right-to work state. What Does Right-to-Work Mean? What Does Right-to-Work Mean?  Collective bargaining – the union and company representatives meet to negotiate a new labor contract

9. Right to Work States

10. To avoid a strike,  a third party may be called in to settle a dispute:  Mediation – neutral mediator meets with each side to try to find some solution. Decision reached by the mediator is nonbinding.  Arbitration – a neutral third party reviews the case and imposes a decision that is legally binding for both sides.

11. Money p. 269

12. What is money?

13.  As an economy becomes more specialized, people give up bartering (exchanging goods and services for other goods and services) for money. Bartering is most commonly used in traditional economies.

14. Three Uses Of Money  Medium of Exchange- money determines value during the exchange of goods and services  Unit of Account- money provides a means for comparing the values of goods and services  Store of Value- money keeps its value if stored rather than used

15. Six Characteristics of Money  Durability- must withstand wear and tear that comes with being used over and over.  (We have coins and paper money.)  Portability- must be easy to transport and exchange  Divisibility- must be easily divided into smaller denominations  Uniformity- people must be able to count and measure money accurately  Limited Supply- supply must be scarce  Acceptability- people must be able to exchange money for goods and services

16. Money’s Value  Representative Value- Our money has value because it can be exchanged for something else of value. It does not have value in and of itself (if it did have a value in and of itself, it would be called commodity money). In America, money used to be “backed” by gold or silver, but this went out in the 1930s.  Fiat Money (also called Legal Tender)- our money is valuable because our government says it is valuable.

17. The New $100 Bill  High Tech Hundred Dolar Bill High Tech Hundred Dolar Bill High Tech Hundred Dolar Bill  Making the $100 bill Making the $100 bill Making the $100 bill

18. How Money is Made  How Money is Made- How Stuff Works How Money is Made- How Stuff Works How Money is Made- How Stuff Works  Anti-counterfeiting measures Anti-counterfeiting measures Anti-counterfeiting measures  Australian Plastic Money Australian Plastic Money Australian Plastic Money

19. How Money is Made  How coins are made…video How coins are made…video How coins are made…video  How Money is Made- Modern Marvels pt. 1 How Money is Made- Modern Marvels pt. 1 How Money is Made- Modern Marvels pt. 1  How Money is Made- Modern Marvels, pt. 2 How Money is Made- Modern Marvels, pt. 2 How Money is Made- Modern Marvels, pt. 2

20. Banking p. 270

21. Money and Banks

22. Bank:  an institution for receiving, keeping, and lending money

23. Early Banking in the US  Very informal banking  A merchant would allow customers to deposit money and charge a small fee  But this was not always safe… what if the merchant goes out of business or is not trustworthy?

24. Two views of Banking….  Federalists (Alexander Hamilton)  Centralized banking was necessary  Hamilton proposed a national bank  issue a single currency  monitor other banks throughout the country  manage the federal government’s funds

25. Two Views of Banking…  Anti-Federalists (Thomas Jefferson)  Decentralized banking system  Banks should be created and operated by the states

26. Functions Of Banks  Storing Money- banks provide a safe, convenient, insured place to store money  Federal Deposit Insurance Corporation (FDIC)- created in 1933 to insure customer deposits if a bank fails (up to $250,000 per account)

27. Functions of Banks  Saving Money- banks provide 4 ways to save money  saving accounts  checking accounts  money market accounts – money lent to the bank for a short period  certificates of deposit (CDs) – money lent to the bank for a longer period of time.  (money held in a checking account is a demand deposit, because checks are paid “on demand”; CDs are time deposits, because the money cannot be withdrawn immediately without penalty)

28. Functions of Banks (continued)  Loaning Money- banks provide loans, and make money by charging the borrower interest  Banks use fractional reserve banking- meaning that banks only keep a fraction of funds on hand and lend the remainder. The Federal Reserve establishes the required reserve ratio, or the fraction of deposits that must be held in reserve. It's a Wonderful Life- Your Money's Not Here It's a Wonderful Life- Your Money's Not Here It's a Wonderful Life- Bank Run (7 min- longer clip) It's a Wonderful Life- Bank Run (7 min- longer clip)

29. Functions of Banks (continued)  Credit Cards- banks issue credit cards (a card entitling its holder to buy goods and services based on the holder’s promise to pay later), and make money by charging interest  Collateral- property used to secure a loan. Lenders require collateral to ensure they will not lose money on defaulted loans.

30. Types of Financial Institutions  Commercial Banks- offer checking services, accept deposits, and make loans  Savings and Loans- originally created when members deposited funds into a general fund and then borrowed money to buy their own homes; now serves many of the same functions of a bank

31.  Credit Unions- cooperative lending associations for particular groups (i.e. state employees), usually small, specialize in home mortgages and car loans, some provide checking/saving

32. Homework  24.2, 24.3, pp. 267-8