Money and Banking Industry
By Megan Wetttein
-A current medium of exchange in the form of coins and banknotes; coins and banknotes collectively.
What are the three uses of money?
-Medium of exchange, unit of account, store of value
What are the 6 characteristics of money?
-Durability, Portability, Divisibility, Uniformity, limited supply, & acceptability
What are the sources of money's value
-Faith in currency, market liquidity, & interest rates
What is the source of value for the money in the United States economy?
History of Banking
What was the role of the First Bank of the United States created in 1791?
- Improved national credit, was seen as necessary
What happened in 1832 when the Bank of 1811 lost its charter?
- Andrew Jackson vetoed the charter bill
What is the Federal Reserve? What is the role of the Federal Reserve today?
- Central banking system of the United States
What is FDIC and when and why was it created?
- Provide stability to the economy
How do economists measure the U.S. money supply?
- M1 & M2
What is the current U.S. money supply?
What services do banks provide?
- checking accounts, saving accounts, loans, and deposits
How do banks make a profit? (Explain and create or find an illustration)
- interest on loans
What are the different types of financial institutions?
- despository and contractual
How has electronic banking affected the banking world?
- speeds up the process