Describe the three main characteristics/roles for money. Describe how these three roles are either independent or interdependent.

The Federal Reserve pursues "stable prices" when conducting monetary policy. Which of those three roles for money does that relate most directly to?

When did the Federal Reserve start pursuing "stable prices" in monetary policy? Was that goal chosen by the Fed, or imposed upon it? What has happened to the CPI since then?

What is the main economic problem solved by money, in its role as a "medium of exchange?"

What are the five main characteristics of money facilitating its role as a "medium of exchange?"

Describe how supermarkets and financial statements illuminate the importance of money in its role as a "unit of account."

What is "liquidity?" What are the main components of "cash," in accounting? Are they equal to one another? If they aren't, can "cash and cash equivalents" even exist?

How does your answers to question 7 relate to banking crises?

Describe how money can be considered both as a stock and a flow.

What is a "clearinghouse?"How do payment systems based on net settlement systems differ from those organized on gross settlement principles?

What are the three main components of the Federal Reserve's accounting for the money supply? Is the third one still with us? Why or why not?

How does M2 differ from M1?

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1 The three main characteristicsroles for money are a Medium of Exchange Money facilitates exchange by providing a widely accepted means of payment b Unit of Account Money serves as a standard unit of ... View the full answer