About money Выполнила преподаватель английского языка ЭФ ГБОУ СПО МКУНТ Лабузова Екатерина Александровна

Money is any object accepted as means of exchange within a society

To be considered as Money an item must have six key characteristics Durability Uniformity Portability Divisibility Acceptability Limited Supply

Durability means that the item must be able to withstand being used repeatedly. Items that are considered Currency, coins and paper bills used as money meet this requirement. Portability means that individuals are able to carry money with them and transfer it easily to other individuals. -This is why coins and paper money have historically proved popular.

- Divisibility means that the money can easily be divided into smaller units of value. - Today, different coins and notes convey these fractional values. Uniformity means that all versions of the same denomination of currency must have the purchasing power. As an example, a 1928 $2 bill will still buy $2 worth of goods or services today.

Limited Supply means that restrictions on the amount of money in circulation ensure that values remain relatively constant for the currency. The responsibility for maintaining an adequate money supply falls on the Federal Reserve System. Acceptability means that everyone must be able to use the money for transactions. In the United States this is indicated on our paper bills by the notation: This note is legal tender for all debts, public and private.

Functions of Money Medium of Exchange This function means that money is accepted throughout the economy as payment for goods and services. Buyers acquire goods by giving up money. Sellers receive money when parting with their goods. This is, without question, the most important function of money. This is the function that makes money MONEY.

Functions of Money Unit of Account A unit of account is a standard numerical unit of measurement of the market value of goods, services, and other transactions. Money allows us to compare similar offers for goods and services to determine the best value.

Functions of Money Store of Value This function means that money can be used to purchase the same quantity of goods and services, that provide the same consumption value, in the future as it can purchase today. Inflation is the primary nemesis for the ability of money to store value. However, the functional value of the stored money may change over time due to other factors.

Money is the matter of functions four A Medium, a Mesure, a Standard, a Store. - William S. Jevon

Classification of Money Commodity money Token money

Commodity Money Its value comes from what made of it

Commodity Money It is objects that have value in themselves as well as value in their use as money

Commodity Money Gold Silver Copper Shells Candy

Token Money This kind of money is usually made of paper but equal to the face value of the money gold is kept in reserve.

Token Money It doesnt have real value in itself Its value comes from either the commodity it stands for or from a government regulation or law.

Token Money Paper money Coins Banknotes Credit cards

hi$toRy of M0NY

Before people used money, they bartered, or traded things they had for the things they wanted. For example, a person may have traded five goats for one cow. Bartering was not always simple, though. Each person had to agree that the items being traded had an equal value. Also, each person had to have something that the other person wanted. People invented money to avoid bartering.

One of the earliest forms of money was metal, such as gold or silver. In North America, Native Americans used beads made of shell, called wampum, as a form of money. China, in 1,000 B.C., produced cowry shells at the end of the Stone Age. In addition, tools made of metal, like knives and spades, were also used in China as money. From these models, we developed today's round coins that we use daily.

In the 600s BC the kingdom of Lydia in what is now Turkey began to make coins. It was probably the first government to do so. These coins were made of electrum, a precious alloy of gold and silver that consists of about 54 percent gold, 44 percent silver, and 2 percent copper.

The Chinese coins were usually made out of base metals which had holes in them so that you could put the coins together to make a chain. The Greeks and Romans minted coins hundreds of years before the time of Christ. The very earliest coins were struck about 600 BC. A lot of the Greek coins were silver.

The first types of paper money were used in China more than 1,000 years ago. Early paper money was simply a written promise to pay a certain amount of gold or silver money. The paper money was valuable because it could be traded for gold or silver. Later, governments began printing paper money.

The last paper money of the Chinese feudal dynasties: 1875 to1908

By the late 18th and early 19th centuries paper money and banknotes had spread to other parts of the world.

The first world money, the Spanish silver dollar or pieces of eight minted in Spain, Mexico and Peru. The Spanish peso contained grams pure silver and was also used as domestic money in Asia, Latin America, America and Europe.

The early 20th century was the great era of the international gold standard. The gold standard is a monetary system in which the standard economic unit of account is a fixed weight of gold.

In July 1944 the agreement of more than 40 countries led to the creation of the International Monetary Fund (IMF), which countries joined by paying a subscription. Members agreed to maintain a system of fixed but adjustable exchange rates. Countries with payment deficits could borrow from the fund, while those with surpluses would lend.

The dollar became the most widely used currency in international trade, even in trade between countries other than the United States. It was the unit in which countries expressed their exchange rate. 1$ George Washington 2$ Thomas Jefferson 5$ Abraham Lincoln 10$ Alexander Hamilton 20$ Andrew Jackson 50$ Ulysses S. Grant 100$ Benjamin Franklin 500$ William McKinley 1000$ Grover Cleveland 5000$ James Madison 10000$ Salmon P. Chase

The largest bill ever circulated in the United States is the $10,000 bill, which features the face of Salmon P. Chase, who was Abe Lincoln's Secretary of the Treasury. If you have one, you can spend it, but most of them are in museums these days.

On August 15, 1971 the system of fixed exchange rates broke down. President Richard Nixon severed the dollar from any connection to gold. Since then the international monetary system has consisted of a collection of currencies linked by floating exchange rates.

12 European countries - Luxembourg, Ireland, Finland, the Netherlands, Belgium, Germany, France, Austria, Italy, Spain, Portugal and Greece adopted the euro. On February 28, 2002 all national bills and coins of the 12 member nations were withdrawn from circulation and the euro became the sole legal currency in use.

Answer the questions 1)What is money? 2)What is portability of money? 3)3 main functions of money are… 4)What is token money? 5)Why did people invent money? 6)What was the first money in China and North America? 7)Where did the first paper money appear? 8)Name first and nowadays world money. 9)When was the IMF founded and what for? 10)What is euro?