Exam Study Chapter 3-What is Money * Medium of Exchange: * Eliminates the trouble of finding a double coincidence of needs (reduces transaction costs) * Promotes specialization * A medium of exchange must * be easily standardized * be widely accepted * be divisible * be easy to carry * not deteriorate quickly * Unit of Account: * used to measure value in the economy * reduces transaction costs * Store of Value:
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ACFI 2005 Finance. 3. A customer has approached your commercial bank seeking to invest funds for a period of six months. The customer is particularly worried about risk following the GFC and the market volatility that continues to characterise world financial markets. Explain the features of call deposits, term deposits and CDs to the customer and provide advice on risk-reward trade-offs that might be associated with each product. Answer: Commercial banks are the main type of financial institution
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Time value of money :A time value of money calculation is one which solves for one of several variables in a financial problem. In a typical case, the variables might be: a balance (the real or nominal value of a debt or a financial asset in terms of monetary units); a periodic rate of interest; the number of periods; and a series of cash flows (in the case of a debt, these are payments against principal and interest; in the case of a financial asset, these are contributions to or withdrawals from
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Money - some people cannot pay in the currency you want "to enable trade to take place in markets which are unable to pay for imports. This can occur as a result of a non-convertible currency, a lack of commercial credit or a shortage of foreign exchange" The Political Environment - local jobs and industry "to protect or stimulate the output of domestic industries (including agriculture and mineral extraction) and to help find new export markets" The Political Environment - rules and regulations
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situations. Macroeconomics can also be useful. The economic well-being of all consumers, rich or poor, is afected by movements in interest rates, exchange rates, and the rate of inflation. Businesses stand to gain or lose considerable amounts of money when their economic environment changes, regardless of how well they are managed. Being prepared for such changes in fortunes can have considerable value; more generally, it makes us all better citizens able to grasp the complex challenges that our
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banks are able to conduct day-to-day check clearing and cash withdrawal transactions. These requirements are also policy tools that the Federal Reserve can use to control the money supply. The most important role is to provide structure and stability to the banking system. 2 My actions would affect growth by placing holds on money transactions such as holds and loans. It’s more important to increase economic growth as opposed to decreasing, ensuring lower unemployment levels. 3 When the economy remains
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the western economies. In this essay, after a brief illustration of the development of banking system in China, the recent event of money shortage in it will be discussed. Development of banking system in China “Piaohao” is the earliest Chinese form of bank which appeared in the Qing dynasty (over 200 years ago). It is a firm for exchanging and transferring money, and it also provided deposit and loan services. However, the first modern bank is established by the English in Shanghai in 1845 (Wang
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securities: bank certificates, bills (drafts), long-term bonds; 5. Banking resources acquired on the interbank market; -1- The structure of attracted resources, and their importance for the conducting banking activities; In the world of banking practice, the attracted resources of a bank can be: 1) Deposit - are formed on the initiative of clients who come to deposit money in the banks, 2) Non-deposit: - Resources arising from the issue of equity (bank certificates, bills of exchange
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1. Business segment the market so that they customers and consumers are two different people e.g. an cat owner is a customer buying the cat food and toys to keep them happy, the consumer is a cat, for cats can’t go shopping buying their own food. This is why businesses segment the market between customers and consumers. Business does not do this for pets only, the target everyone e.g. families and parents business uses baby nappies and baby food for the parents to buy as a customer and the consumers
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Jean Baptiste Say Economic Doctrines Agenda 1. Introduction 2.1. J.B.Say in the french Classical Liberalism school of thought 2.2. Mainstream of the Classical Liberalism school of economics 2.3. Specifics of J.B.Say 2.4. Differences regarding the opposition of Classical Liberalism 2. Description of J.B.Say 3. New approach brought by J.B.Say 4. Opinion 5. Summary 1. Introduction 1.1. J.B.Say
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