Money, according to our definition, A. has to be backed by something valuable, such as gold or silver. B. does not have to be generally accepted in payment of obligations. C. can include credit. D. has to be issued by government. E. none of the above Money, according to our definition, A. need not be in common use. B. is generally accepted to pay debt. C. has to be issued by government. D. does not need to be useful to pay off obligations. E. needs to be backed up by gold.
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The United States had been spending money while having a national debt since 1960. National debt existed for three main reasons: economic, political, and future unpredictability. Economic concerns include the national debt being a grave concern if it wasn’t able to be paid back because it would regard our once stable valuable currency as worthless. Eight percent of all federal spending was an affordable interest on the debt. The government would be called upon economically in the future and the growing
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Money Importance of Money Money is an essential and basic necessity in a modern economy. In the beginning of human existence, human needs were so simple that they could be satisfied by barter system , i.e., exchange of goods for goods. In baster system, an individual produces some goods in greater quantity than what he could consume and then exchanges the extra units with another individual for something he needed in return. Barter system suffered from lack of double coincidence of wants, lack
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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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21 Homework for Chapter 14 List and briefly explain the advantages that money has over barter? How do the three functions of money get around the problems of barter? 1) Money is a medium of exchange, allowing it to be used to buy any of the items available in the market. Barter on the other hand exchanges items for other items, and these items are limited in what they can be traded to get. 2) Money is also a unit of account. Societies use monetary units such as dollars in an effort
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Effects of Inflation Author Author Affiliation Causes and Effects of Inflation Supply and demand are one of the key factors when it comes to the economics of a country or region. The two factors happen to be the greatest determinants of prices. In cases where there is a high demand and low supply in a region, the prices of commodities or services provided tend to hike. The hiked prices due to high demand and low supply lead to inflation. Inflation has become a worldwide phenomenon that has seen the
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(P4) Explain how both fiscal and monetary policy decisions have affected a selected business In this part of my assignment I will be explaining the use of fiscal and monetary policy and how these policies affect global/international organisation. The organisation I have chosen to refer to in this part of my assignment is Microsoft. Microsoft is an American multinational software corporation headquartered in, Washington that develops, manufactures, licenses, and supports a wide range of products
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Money is a hot topic within the majority of households in the United States. Money is something we all need to pay bills, buy groceries, and to purchase entertainment items such as video games or movies. It is also something we need to make larger purchases such as a car or a new home. Not many of us think about the uses or functions of money, we just know that we need money to obtain the things that we want. The purpose and function of money is to devise an artificial value as medium used to evaluate
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and investment plans likely to be affected by the high interest rates Answer According to Thomas E Stitzel interest rates are the prices of credit,the cost of money,the earning rate on financial assets.It can also be defined as a fee paid on borrowed capital. Generally speaking, a higher real interest rate reduces the broad money supply. The "real interest rate" is the nominal interest rate minus the inflation rate. Zimbabwe continues to have negative real interest rates. These rates discourage
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systems for setting levels of taxation, government budgets, the money supply and interest rates as well as the labor market, national ownership, and many other areas of government interventions into the economy. Most factors of economic policy can be divided into either fiscal policy, which deals with government actions regarding taxation and spending, or monetary policy, which deals with central banking actions regarding the money supply and interest rates. Fiscal policies: refers to the government's
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