ECO 1102 Lecture Notes - Lecture 13: Piggy Bank, Commodity Money, Debit Card

• School: University of Ottawa
• Department: Economics
• Course: ECO 1102
• Professor: Golnaz Sedigh

Document Summary

Chapter 10 part 1: the monetary system. Money: the set of assets in the economy that people regularly use to buy g&s from other people. Medium of exchange: an item that buyers give to sellers when they want to purchase g/s. Unit of account: the yardstick people use to post prices and record debts. Store of value: an item that people can use to transfer purchasing power from the present to the future. Wealth: is the total of all stores of value, including both monetary and non-monetary assets. As a unit of account (not a means of payment, a store of value, or a medium of exchange) Eg: mia puts money intro a piggy bank so she can spend it later. Store of value (not medium of exchange, unit of account, or wealth) Liquidity: describes the ease with which an asset can be converted intro a medium of exchange. Money is the most liquid of assets.