Chapter 14: Money, Banking, and The Fed

Open Ended

What bank do you/your family use for your financial needs?

Chapter 14: Money, Banking, and The Fed

Functions of Money

• Medium of Exchange: An accepted

form of payment for goods and
services

Multiple Choice

Vanessa used Apple Pay to pay for her recent haircut. Which function of money allowed Vanessa to use this form of payment?

• Medium of exchange

• Standard of value

• Store of value

• Standard of value: Used to measure

worth of goods/services

Multiple Choice

Martin buys a new pair of Vans sneakers and spends $65. Which function of money helps him understand the cost of the shoes?

• Medium of exchange

• Standard of value

• Store of value

• Store of value: Consumers can save

money to use later; money will keep its
value

Multiple Choice

Felipe has saved $500 from his job and wants to save all of it for at least one year. Which function of money allows for him to do this?

• Medium of exchange

• Standard of value

• Store of value

What is the Federal Reserve?

● The Federal Reserve is the central

bank of the United States

Multiple Choice

What is another name for APR?

• credit score

• credit history

• interest rate

• grace period

Goals of the Federal Reserve

*Please

write
this in
your

notes!*

Multiple Choice

What does APR stand for?

• Annual Portion Range

• Annual Percentage Range

• Actual Percentage Rate

• Annual Percentage Rate

Federal Reserve System Structure

12 Reserve Banks

Multiple Choice

What are the names of the three credit bureaus?

• Equalfax, Transunion, and Experian

• Equifax, Transunion, and Experian

• Equifax, Transport, and Experian

• Equifax, Transunion, and Experience

Federal Reserve Banks

• Distribute the

nation’s currency
and coins

• Serve as banker

for the U.S.
Treasury

Monetary Policy

•

Controlling the growth of the money
supply

1. Tight/Contractionary monetary policy:
Decreases the money supply
•

Less money means less spending
and less inflation → can lead to
contraction

2. Loose/Expansionary monetary policy:
Increases the money supply
• More money means more spending and

expansion → can lead to inflation

Match

Match the following

• _____ is the price that borrowers pay to borrow money

• _____ is how much money each bank is required by the Fed to keep on hand

• _____ is the interest rate the banks charge their best customers

• _____ is the amount of money circulating in the economy

interest rate

reserve requirement

prime rate

money supply

• interest rate

• reserve requirement

• prime rate

• money supply