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Chapter 3 Money

Chapter Objectives

By the end of this chapter, students should be able to:

  1. Define money.
  2. Describe the work or economic functions that money performs.
  3. Define barter and explain why it is economically inefficient.
  4. Explain why some forms of commodity money are better than others.
  5. Explain why representative, credit, and fiat money are supplanted commodity money.
  6. Define the money supply and explain how and why it is measured.