characteristics and functions of money and types of money
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9 Terms
functions of money
a medium of exchange
money allows for g/s to be trade w/o a need a need for a barter system
store of value
ppl can save now to fund spending at a later date -its value is still recognised
unit of account
the physical representation of money in terms of coins, notes and pence as used for goods and services
standard of deferred payment
enables businesses and individuals to make defferred payments (loans/mortgages)
Characteristics
physical durability, portable, divisible, hard to counterfeit
the money supply
is the stock of currency and liquid assets in the economy (cash and money in savings account)
narrow money
easily withdrawable money (coins, notes) easily converted into cash ST deposits
→ 3.5 % of UK payments
broad money
total money supply held by households/companies - mainly commercial banks deposits to households/businesses
→ 95% of UK payments
Note 
Flashcards (29)