Unit 2 Lesson 5Unit 2 Lesson 5

MoneyMoney

Game PlanGame Plan

►Find out why we use money.Find out why we use money. Complete an assignment about money in Complete an assignment about money in

groups.groups. Mr. Cook says a few things about money.Mr. Cook says a few things about money. Group Activity-The Functions of MoneyGroup Activity-The Functions of Money Money quiz--open notes, closed mouthMoney quiz--open notes, closed mouth Re-CapRe-Cap

Group AssignmentGroup Assignment

►Why is money useful?Why is money useful?►Your group Your group mustmust try to think of try to think of two two

differentdifferent reasons why money is useful. reasons why money is useful.►2 reasons!!!!2 reasons!!!!►You don’t have to write anything down, You don’t have to write anything down,

but have 2 reasons to share with the but have 2 reasons to share with the class.class.

►You have a couple of minutes. Go!You have a couple of minutes. Go!

3 Functions of Money3 Functions of Money

►Medium of exchange: buy stuff ►Unit of measure: measure worth►Store of value: hold value

TypesTypes

► Barter: tradeBarter: trade► Commodity moneyCommodity money

(gold, spices, etc.)(gold, spices, etc.)► Fiat moneyFiat money: :

gov’t says it’s gov’t says it’s valuablevaluable

we believe thatwe believe that

ListenListen

► Funny MoneyFunny Money► Chocolate: Cacao seeds were used Chocolate: Cacao seeds were used

in 1500s by in 1500s by AztecAztecs. s. ► SaltSalt: The word "salary" comes : The word "salary" comes

from the word "salt."from the word "salt."► Cattle: Have been used as Cattle: Have been used as

currency since 9,000 BC. currency since 9,000 BC.

Money in Colonial America - Listen- Listen

►Corn, gunpowder, tobacco, Corn, gunpowder, tobacco, wampumwampum

►States let individuals print their States let individuals print their own $ backed by gold.own $ backed by gold.

►During American Revolution, During American Revolution, 250 million “250 million “Continental Continental dollarsdollars” were issued.” were issued.

Group AssignmentGroup Assignment

► Imagine you’re talking to Imagine you’re talking to someone who has never someone who has never seen or used money.seen or used money.

►Describe money to this Describe money to this person.person.

►Have someone in the group Have someone in the group write this down.write this down.

CharacteristicsCharacteristics

►PortablePortable►Durable Durable ►DivisibleDivisible►Limited Supply Limited Supply

(to hold value)(to hold value)

Some islanders in Micronesia used these carved stones called “Vai” as currency .

►Money WorksheetMoney Worksheet

Money QuizMoney Quiz

1. 1. On the island of Yap, large circular stones are used for

money. The main reason why this type of money serves its function

as a medium of exchange is because it is

►A) Medium of ExchangeA) Medium of Exchange►B) Unit of MeasureB) Unit of Measure►C) Store of ValueC) Store of Value►D) Limited AvailabilityD) Limited Availability

2. You are saving your money so 2. You are saving your money so that you will be able to afford a that you will be able to afford a car this summer. What function car this summer. What function

of money are you using? of money are you using?

►A) Medium of ExchangeA) Medium of Exchange►B) Unit of MeasureB) Unit of Measure►C) Store of ValueC) Store of Value►D) Limited AvailabilityD) Limited Availability

3. I estimate that Frank’s car is 3. I estimate that Frank’s car is worth $11,000. What function of worth $11,000. What function of

money am I using? money am I using?

►A) Medium of ExchangeA) Medium of Exchange►B) Unit of MeasureB) Unit of Measure►C) Store of ValueC) Store of Value►D) Limited AvailabilityD) Limited Availability

4. You buy a Dr. Pepper at the 4. You buy a Dr. Pepper at the Chevron. What function of Chevron. What function of

money are you using? money are you using?

►A) Medium of ExchangeA) Medium of Exchange►B) Unit of MeasureB) Unit of Measure►C) Store of ValueC) Store of Value►D) Limited AvailabilityD) Limited Availability

5. 5. The use of money in an economy solves which of the

following problems?

►A scarcity►B the condition of opportunity cost►C an efficient means of economic

exchange►D trade barriers

So, Why Do We Use Money?So, Why Do We Use Money?

►3 Functions3 Functions►Problems With BarterProblems With Barter