Money (Grade 11 NSC Matric Economics): Flashcards
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Definition of money
Definition of money
Item widely used & accepted for exchanging goods & services
Number of essential characteristics money must have
Number of essential characteristics money must have
Seven characteristics
Three primary functions of money
Three primary functions of money
Medium of exchange, unit of account, store of value
Medium of exchange function
Medium of exchange function
Convenient way to pay for goods & services instead of bartering
Unit of account function
Unit of account function
Standard way to measure & compare value of different items
Store of value function
Store of value function
Allows saving of purchasing power for future use
Commodity money
Commodity money
Money with intrinsic value in itself (e.g., gold, silver)
Fiat money
Fiat money
Currency with little commodity value, backed by government decree
Bank money
Bank money
Credit from banks; electronic transfers without physical cash
SARB's inflation target range for South Africa
SARB's inflation target range for South Africa
3-6% per year