Money and the Financial System and Banking and the Money Supply
Your assignment is worth 6 pts, and each of the questions must have at least a half of page of writing
In addition your answers must prescribe to APA format.. You must submit a cover page, each question in a page by itself, and your references page must be also in a page by itself. And, please do not forget to reference your in-text. Lastly your assignment must be submitted via “Safeassign” in order to obtain your max points your work must be original in at least 70%.
Answer the following questions:
– What are the three important functions of money? Define each one of them.
– Why is universal acceptability such an important characteristic of money? What other characteristics can you think of that might be important to market participants.
– In acting as financial intermidiaries, what needs and desires of savers and borrowers must banks consider?
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Money and the Financial System and Banking and the Money Supply
Question 1
Money plays several functions in any given economy. There are three major functions that are played by money. They include store of value, unit of account, and medium of exchange. One of the major functions is that money is used as a medium of exchange. In the past, people used to exchange commodities and services for others in a system that was known as barter trade. The system was very difficult since it required one to find another person who needed the product that was being sold. Money helped solve this issue. It can also be broken down into smaller units making it to be a convenient medium of exchange.
(625 words)