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S-I MODEL: A model used to identify equilibrium in Keynesian economics based on injections (investment, I) and leakages (saving, S) for the two basic sectors (household and business). Equilibrium is achieved at the intersection of the saving line, S, and the investment line, I.
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Lesson 17: Money | Unit 1: Money Basics
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Page: 2 of 25
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The notion of general acceptance makes money THE medium of exchange for economic transactions. It must be generally accepted. - Two types of value:
- Value in use (intrinsic value): An item provides satisfaction of wants and needs.
- Value in exchange: An item does not provide satisfaction directly but can be traded for something that does.
- Money may or may not have value in use, but to be a medium of exchange, it must have value in exchange.
Money is an economic lubricant. - Too much money prompts inflationary expansion and too little entices recessionary unemployment.
- The challenge is to maintain the proper balance between too much and too little.
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M3 The wide-range monetary aggregate for the U.S. economy containing the combination of M2 (currency, checkable deposits, and assorted savings deposits) and large-denomination, institutional near monies. M3 contains financial assets that are relatively liquid, but not quite as liquid as those found in M1 or M2. The near monies added to M2 to derive M3 include large denomination certificates of deposit, institutional money market mutual funds, repurchase agreements, and Eurodollars. M3 is one of three monetary aggregates tracked and reported by the Federal Reserve System. The other two are designated M1 and M2.
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BLACK DISMALAPOD [What's This?]
Today, you are likely to spend a great deal of time visiting every yard sale in a 30-mile radius wanting to buy either a brown leather attache case or car battery jumper cables. Be on the lookout for mail order catalogs with hidden messages. Your Complete Scope
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Three-forths of the gold mined each year is used to manufacture jewelry.
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"Good judgment comes from experience, and often experience comes from bad judgment." -- Rita Mae Brown ‚ Writer
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IADB Inter-American Development Bank
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