Money and Banking Industry

By: Amanda Dahl

Money

  • What is money?~ Money is the value that is widely accepted to transfer goods and services.
  • What are the three usses of money?~ 1.) Medium of Exchange= to sell and buy goods and services, 2.) Unit of Account= to measure wealth of a good or service, 3.) Store of Value= it can tell how wealthy a store is
  • What are the six characterstics of money~ 1.) its portable, 2.) its durable, 3.) its divisible 4.) its avialible but only in limmited supply, 5.) uniformity, 6.) acceptability
  • What are sources of money's value?~ commodity money, represenditive money, fiat money
  • What is the source of value for money in the United Sates economy?~ 56229067

History of Banking

  • What was the role of the first bank of the United States created in 1971?~ because the government had a debate from the Revolutionary War and each state had a different form of currancy
  • What happened in 1832 when the Bank of 1811 losts its character?~ a bank war
  • What is the Federal Reserve? What is the role of the Federal Reserve today?~ the Federal Reserve is a central bank, also known as the national banking system
  • What is FDIC and when and why was it created?~ Federal Deposit Insurence Corporation (FDIC), the banking act of 1933 created the FDIC, the FDIC was created becuase of banks failed during the great depression, depositors lost more or even all their savings becuase deposits were not insured
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Banking Today

  • How do economist measure the money supply?~ with M's like M1, M2, and M3
  • What is the current U.S. money supply?~3983882
  • What services to banks supply?~ checking accounts or DDAs, savings accounts and time deposits, debit cards, credit cards, smart card, electronic funds transfer (EFT), electronic funds transfer
  • How do banks make a profit?~ they make loans and the amount of intrest is greater than the amount of money, the difference is their profit
  • What are the different types of finacial institutions?~ depositary institutions that accept and manage loans, constructual institutions are insurance companines and pension funds
  • How has electric banking affected the world?~ it has provided easy access to a bank accoount at any time any place