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Unit 2, Lesson 4 The Function of Money

AOF Principles of Finance. Unit 2, Lesson 4 The Function of Money. Money is so common that we rarely think about what it is. _____________ is any medium that is generally accepted as payment for goods and services. Money is used to get the things we need and want.

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Unit 2, Lesson 4 The Function of Money

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  1. AOFPrinciples of Finance Unit 2, Lesson 4The Function of Money

  2. Money is so common that we rarely think about what it is • _____________ is any medium that is generally accepted as payment for goods and services. • Money is used to get the things we need and want. • The characteristics of money include: __________, ____________, __________, and ___________ What would it be like to live in a world without money?

  3. Money facilitates the direct exchange of goods and services • Before money was around, people used to _________ to obtain the goods and services that they needed. • People traded jewelry, shells, livestock, stones, tools, and much more. • Bartering wasn’t very efficient or convenient. • Bartering requires a “_________________________________”—a rare occurrence. Describe a time when you bartered with someone for something that you wanted.

  4. People use money when any ____________________is purchased. Money ensures the successful exchange of one item for another. Money serves as a way for people to get goods and services they do not produce with ease. Money enables us to easily trade goods and services How does using money as a medium of exchange simplify your life today?

  5. Money is a way to hold wealth • Money is a store of value and can be used to ____________________ • You can store the value of the goods and services you produce. • You can save the value of what you make today to purchase items in the future. • __________, __________, ___________, and ___________are just some of the ways that people hold wealth. What are some of the advantages and disadvantages of storing wealth as stocks, bonds, and/or real estate?

  6. Money is a standard unit of measurement • Money is a unit of __________ • The price of all the other ________________ are measured in terms of money. • Money allows you to ___________ goods and services by a common attribute. • Items become valued in terms of dollars or portions of a dollar.

  7. Money simplifies trade • If used appropriately, money can make life easier. • Money serves a specific purpose in society. • Money is a _____________ and is required for survival. • Money should be managed and used responsibly.

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