ECON 1010 Chapter Notes - Chapter 24: Canada Deposit Insurance Corporation, Credit Union, Mortgage Loan
Document Summary
Chapter 24: money, the price level, and inflation. Defined as any commodity or token that is generally an acceptable form of payment. A means of payment is a method of settling a debt. When a payment has been made, there is no remaining obligation between the parties to a transaction. A medium of exchange is any object that is generally accepted in exchange of goods or services. Without a medium of exchange, goods and services must be traded for other goods and services - an exchange called barter. Barter requires a double coincidence of wants , a situation that rarely occurs. For example: if you want a burger, you might offer a cd in exchange for it, however you now have to find someone who has a burger and wants your cd. A medium of exchange overcomes the need for a double coincidence of wants.