Economic Revision unit 7

What is money?

Money is anything which is generally acceptable as medium of exchange against goods and servicess

What are the forms of money?

Banter system - barter system is the direct exchange of commodities where there is a double coincidence of wants

• Commodity money

• Metalic money

• Notes and coins

• Towards a cashless society

Give the characteristics of money

• Durable

• Acceptable

• Divisible

• Unifirm

• Scare

• Portable

GIve the functions of money

• Unit of accounts

• Store of value

• Medium of exchange

• Standard of deffered payment

What is commercial bank?

Commercial bank accepts deposits, gives loans, provides financial services to private individuals and firms

Give the functions of commercial banks

• Accept deposits

• Gives loans

• Provide advices to customers

• Assist customers in making payment

What is central bank?

Cental bank is an institutions established by the government to control financial activities of a country.

Give the functions of a central bank

• Setting rules and regulations

• Monitoring the banking system

• Acting as the government's bank

• Issuing notes and coins

• Acting as bankers’ bank

• Keep gold and currency reserves