About This Chapter
Who's it for?
This unit of our Macroeconomics Homeschool course will benefit any student who is trying to learn about the intricacies of money, banking and financial markets. There is no faster or easier way to learn about economics. Among those who would benefit are:
- Students who require an efficient, self-paced course of study to learn about stocks, bonds, deposits, loans, money demand and the multiplier effect.
- Homeschool parents looking to spend less time preparing lessons and more time teaching.
- Homeschool parents who need an economics curriculum that appeals to multiple learning types (visual or auditory).
- Gifted students and students with learning differences.
How it works:
- Students watch a short, fun video lesson that covers a specific unit topic.
- Students and parents can refer to the video transcripts to reinforce learning.
- Short quizzes and a money, banking and financial markets unit exam confirm understanding or identify any topics that require review.
Money, Banking and Financial Markets Unit Objectives:
- Define financial assets such as money and bonds.
- Explain the present and future value of money.
- Explore the process of determining the current supply of money in circulation.
- Define money and discuss three forms of money.
- Describe the ways in which money is utilized.
- Discuss the origins of the fractional reserve system.
- Study the fractional reserve system and the lending processes of banks.
- Provide examples of the multiplier effect.
- Describe factors that influence the demand curve for money.
- Explain the economic model of the money market.
1. Types of Financial Assets: Money, Stocks & Bonds
For an economy to operate effectively, consumers and businesses need a common medium of exchange and mechanisms to encourage some people to save, others to borrow and others to invest. In any modern economy, these needs are met with money, stocks and bonds.
2. Present and Future Value: Calculating the Time Value of Money
A central concept in business and finance is the time value of money. We will use easy to follow examples and calculate the present and future value of both sums of money and annuities.
3. Measuring the Money Supply: Explanation and Examples
Discover how the Federal Reserve defines the money supply by exploring the components of the money stock. In this lesson, we also look at the money supply in terms of function and liquidity.
4. 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.
5. 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.
6. 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.
7. 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.
8. 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.
9. 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.
10. 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.
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Other chapters within the AP Macroeconomics: Homeschool Curriculum course
- Scarcity, Choice & Production Possibilities Curve: Homeschool Curriculum
- Comparative Advantage, Specialization & Exchange: Homeschool Curriculum
- Demand, Supply & Market Equilibrium: Homeschool Curriculum
- Measuring the Economy: Homeschool Curriculum
- Inflation Measurement & Adjustment: Homeschool Curriculum
- Understanding Unemployment: Homeschool Curriculum
- Inflation and Unemployment: Homeschool Curriculum
- Aggregate Demand and Supply: Homeschool Curriculum
- Macroeconomic Equilibrium: Homeschool Curriculum
- Economic Growth and Productivity: Homeschool Curriculum
- Central Bank and the Money Supply: Homeschool Curriculum
- Fiscal and Monetary Policies: Homeschool Curriculum
- Foreign Exchange & Balance of Payments: Homeschool Curriculum
- Inflows, Outflows and Restrictions: Homeschool Curriculum