Ch 16: Fundamentals of Money & Banking

About This Chapter

Reactivate your memory of the fundamentals of money and banking by using this chapter filled with engaging video lessons. Take short quizzes to illustrate what you know.

Fundamentals of Money & Banking - Chapter Summary

This chapter provides you with short and in-depth lessons about topics including the definition of money, the four functions of money, the money demand, the ways the government protects your money during a crisis and much more. When you've finished the lessons, you can demonstrate the information you remember by taking brief multiple-choice quizzes. Other topics that are included in this chapter are here:

  • Bank lending as a way of making money
  • Formula for multiplier effect
  • Money demand curves of the money market
  • Institutions within the United States banking system
  • Excess reserves of the fractional reserve system
  • Technology's positive impact on banking
  • International banking
  • The World Bank and other international banking associations

This mobile-friendly chapter allows you to review any topic you'd like. Print out the worksheets and answers to quiz yourself while you're away from your electronic devices. There are links within the quizzes to go back to specific topics in the lessons. Use the video tags located beneath each video to visit different topics.

12 Lessons in Chapter 16: Fundamentals of Money & Banking
Test your knowledge with a 30-question chapter practice test
What is Money? - Definition and Types

1. What is Money? - Definition and Types

In this lesson, you'll learn what money is and its four basic functions. You'll also take a look at how it benefits society and explore the different types of money.

The Four Basic Functions of Money

2. The Four Basic Functions of Money

This lesson uses real-world examples to describe the four basic functions that money serves in an economy. These basic functions help to create the foundation of the money system.

How Money Is Made: Understanding Bank Lending in the Economy

3. How Money Is Made: Understanding Bank Lending in the Economy

In this lesson, you'll learn how a single deposit in a local bank increases the money supply and filters through the economy with the help of the fractional reserve banking system.

Money and Multiplier Effect: Formula and Reserve Ratio

4. Money and Multiplier Effect: Formula and Reserve Ratio

In this lesson, explore the concept of the multiplier effect and the money multiplier. Then, learn the formula for calculating changes in the money supply.

Money Demand and Interest Rates: Economics of Demand

5. Money Demand and Interest Rates: Economics of Demand

Learn about the differences between money, wealth and income and explore the factors that determine the demand for money in an economy. Take a look at the demand curve for money as well.

The Money Market: Money Supply and Money Demand Curves

6. The Money Market: Money Supply and Money Demand Curves

This lesson explores an economic model describing the supply and demand for money in a nation, referred to as the money market. It also describes the central bank's role in controlling the money supply, which impacts interest rates and the greater economy.

Institutions of the U.S. Banking System

7. Institutions of the U.S. Banking System

The United States banking system is diverse and consists of many different types of institutions. In this lesson, you'll learn about commercial banks, savings and loan associations, credit unions, and investment banks.

Fractional Reserve System: Required and Excess Reserves

8. Fractional Reserve System: Required and Excess Reserves

This lesson provides an overview of basic banking concepts, illustrating how deposits turn into required reserves and excess reserves. It also covers how a bank accounts for these items on its balance sheet.

How the Government Protects Your Money During a Financial Crisis

9. How the Government Protects Your Money During a Financial Crisis

In this lesson, you'll learn about some of the causes of the financial crisis of 2008 that brought us the Great Recession. You'll also learn what steps the federal government can take to help protect your money when the next financial crisis hits.

How Technology Makes Banking More Efficient

10. How Technology Makes Banking More Efficient

If you've ever heard the cliché 'banker's hours,' you know that banking traditionally has not been a fast and efficient process. In this lesson, you'll learn about how technology has improved the efficiency of banking for customers.

International Banking and Services

11. International Banking and Services

Business never stops in the global economy. Companies need banking services 24 hours a day on different continents. In this lesson, you'll learn about international banking, including services provided and types of banks.

The World Bank, IMF & Other International Banking Organizations

12. The World Bank, IMF & Other International Banking Organizations

International banking and financial organizations exist to encourage economic and financial stability, help facilitate trade, and help with economic development. In this lesson, you'll learn about some of these important organizations.

Chapter Practice Exam
Test your knowledge of this chapter with a 30 question practice chapter exam.
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Practice Final Exam
Test your knowledge of the entire course with a 50 question practice final exam.
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