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Chapter 11 Section 1

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					              Chapter 11 Section 1

• I. Functions of Money
• A. Medium of exchange-accepted by
  everyone
• B. Measure of value-common worth
• C. Store of Value-purchasing power is
  saved until needed
• II. Money In Early Societies
• Commodity money-has an alternative
  use.
• Fiat money – by government decree
• III. Money in Colonial America
• A. Tobacco and wampum were once
  accepted forms of currency.
• B. States passed laws allowing
  individuals to print paper currency,
  which was backed in local banks with
  gold and silver deposits.
• C. During the American Revolution,
  Continental dollars were issued but
  without gold or silver backing - which
  made them worthless.
• D. Specie, or gold and silver coins,
  were commonly used in the colonies.
• IV. Origins of the Dollar
• A. When the nation began, the most
  plentiful coin in circulation was the
  Spanish peso.
• B. Benjamin Franklin and Alexander
  Hamilton differentiated the dollar
  system from the pesos by dividing the
  dollar into tenths.
   Characteristics of Money


• A. Portable-easily transferred from
  one person to another.
• B. Durable-lasts when handled or
  stored for long periods.
• C. Divisible to facilitate all types of
  transactions.

• D. Limited supply to retain its value.

				
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posted:6/26/2011
language:English
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