4.

Describe the history of money in the Philippines

The History of money in the Philippines was remarkable. When the Spaniards arrived in the Philippine, trade
among the early Filipinos and trades from and other neighboring land was performed using the barter system.
Commodity money such as gold, gold dust, silver wires, coffee, sugar rice, spices, carabao were used as money.
They introduced coins in the Philippines when they colonized the country in 1571. In 1898 Declaration on
Independence brought a short-lived revolutionary currency replacing the Spanish-Filipino Peso. President
Emilio Aguinaldo, issued its own coins and paper currency under the Malolos Constitution. During World War
II, the Japanese issued the Japanese War notes. There bills had no reserves nor backed up by any government
asset and were called “mickey mouse” money. All Japanese currencies circulating in the Philippine were
declared illegal, all banks were closed and all Philippine National Bank notes were withdrawn from circulation.
In 1949, a new currency called “Central Bank Notes” was issued. In 2018, the New Generation Currency Coin
series were put in circulation. (Page 16-17) (Par 1-10)

5. Explain briefly how money facilitates the flow of resources in macroeconomy

It facilitates if the money was not enough, the economy will slow down and if it is too much money, it can cause
inflation because of higher price level. Either way, monitoring the supply and demand for money is vital for the
economy’s central bank monetary policy, which aims to stabilize price levels and to support economic growth.
(Page 20) (Par 1-2)

9.A student makes the following assertion:

“It is not possible for the total value of production to increase unless the money supple also increases.
After all, how can the value is more money available”

I can say that I agree and disagree, inflation may cause the overall value of manufacturing to rise with increased
purchasing power, but there will also be higher costs. Technically, the number does rise, but proportionally
speaking, the total worth of production remains essentially unchanged. (Page 19) Par 4-5)

12.Some investment analysts argue that very low interest rates on some long-term bonds make them
risky investments.

The real interest rate is unstable and constantly changing, which makes it difficult for both parties to reach an
agreement in the middle because one party might have more or less purchasing power of his money if the real
interest rate moves up or down in opposition to the nominal rate. As a result, interest rates and the prices of
financial securities move in opposite directions. (Page 26) (Par 3-4)

14. Does preference of liquidity increase or decrease the cash value of a future income? Explain in your
own words.

The preference for liquidity only serves to compensate lenders for lending their liquidity under challenging and
unforeseen circumstances; it has no impact on the cash value of future revenue. As the borrower's income rises,
the amount that will be sought will as well. (Page 26) (Par 1)

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3. Explain the expression “Legal Tender”.

Legal tender means the government accepts paper currency in payment of taxes and requires that individuals
and firms accept it in payment of debts. (Page 32) (Par 1)

4.Explain briefly the importance of using checks in paying for good or services purchased.

Using checks for paying goods and services is more convenient, you can have a proof of payment and a way
to trace the payment for goods and services (Page 33) (Par 1-2)

5:2 Describe bitcoin

Bitcoins are produced by people performing the complicated calculations necessary to ensure that online
purchases made with bitcoins are legitimate, people can buy and sell bitcoins in exchange for dollars and other
currencies on web sites, some people refer to it as a “cryptocurrency.” (Page 35-36) (Par 2-4)

5:3 Describes blockchain

Blockchain is technically a distributed ledger or an online network that registers ownership of funds, securities
or any other good, including movies and songs. Blockchain allows individuals and businesses around the world
to settle transactions instantly and securely on encrypted sites. (Page 36) (Par 3)

6. Describe a cashless society. Is it easily attainable?

A cashless society is not easily achieved because it is expensive to construct the infrastructure for e-payment
systems and because businesses and individuals are concerned about the security of their money from hackers.
As a result, it is doubtful that paper money would vanish from the payment system. (Page 36) Par 4)

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