Cmrmiranda Powerpoint Presentation November2011 Macro Economics

Cmrmiranda PowerPoint Presentation
November2011 Macro Economics

Money can be defined as an object that is
readily accepted from anybody as full payment
for purchase of a certain commodity or for service
rendered by an individual. This may take the form
of metal coins, paper money issued by the
government, banks or personal checks.

Barter System- the direct exchange of goods for
goods, services for services, goods for services and
services for goods. It is the earliest system of
trading.
With the passage of time,
the barter system presented
difficulties which tended to slow
down exchange. This lead to the
use of one object as a medium of
exchange for other goods came
into use. This system can be
known as Money Economy.

1. Burdensome
2. Inconvenient due to difficulty in finding

goods which one directly needs.
3. Does not have proper measure for the

goods being exchanged.
4. Indivisibility of some goods

1. Commodity Money
2. Metallic Money
3. Representative
Money
4. Paper Money
5. Bank Drafts or
Checks

• It must be portable. •It must have elasticity of
supply.
•It must be homogenous.
•It must be stable in
•It must be durable. value.
•It must be recognizable.
•It must be divisible.
•It must be malleable.
•It must possess general

acceptability. Cmrmiranda PowerPoint Presentation
There are many uses or functions of money and these are
money as a:
Medium of Exchange. The money is the medium
of exchange because it is always in the middle between
the buyer and the seller.
Standard Value. This is being performed when all

articles or services are given a value in terms of a certain
number of units of one particular type of goods.
Standard for Postponed Payments.
Store of Value. It becomes a store value when an

amount of it is kept for a period of time.
The Monetary Unit
This refers to the type of money expressed by
law as the standard value and the circulating medium. It is
made of a particular metal or commodity with a fixed
weight and fineness.
The System of Coinage

The government has undertaken sole
responsibility for the manufacture of metals into coins to
avoid difficulties such as varied sizes and shapes, designs,
weights and counterfeiting.
Circulating Media Cmrmiranda PowerPoint Presentation

All matters related to the issuance, value,
Monetary Reserves
Important in controlling credits. The
security of the depositors and as an instrument of
control by the government in cases of economic
instability due to too much credit or to an imbalance in
foreign payments.
Local Tender Quality Money
*Legal Money Tender- a money which is declared

by the law as acceptable for payment of debts, both
public and private.

Has several types
namely;
Monometallism. A commodity standard based on one
metal.
Bimetallism. Based on two metals which are standard

money at a fixed value in terms of one another.
Symmetalism. Based on a single metallic unit which is a

mixture of different metals legally proportioned.
Composite Commodity / Commodity Reserve

Standard. Still on the planning stage consists of an
assorted list of staple commodities which will serve as the
standard unit. November2011 Macro Economics
The paper standard is one which does not use gold or
any metal as the basis of value. This is also called as Credit or
Fiduciary Standard because it is dependent on the people’s trust
in the government.
*Flat Standard because the money circulation assumes

its value by decree of the government.
*Money Paper Standard because the government

supervises the circulation of the money to the public.

The Central Bank of the
Philippines is chiefly responsible for
the implementation of our monetary
policy and is the sole authority on
money matters as embodied in the
Section 2, Articles of the Amended
Republic Act 265. It regulates the
circulation of money in order to help
trade and industry meet their needs.
It is the only agency which can issue
money in the Philippines and is
responsible for maintaining the
stability of peso so itCmrmiranda
will PowerPoint
always be
Presentation
accepted within andNovember2011
outside the
Macro Economics
ESO
Monetary Policy can be defined as set of
guidelines and plans of action designed to
achieve stability and reliability of the financial
system so that it automatically responds and
adjusts to the changes and dynamics of an
economy.

The primary objective of the monetary
policy is to provide financial stability that
promotes growth and development of the
economy with minimal inflation.
The success indicator of monetary policy is the
rate of inflation in lower result.


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Cmrmiranda PowerPoint Presentation

November2011 Macro Economics