FZCDLLCTION E W E 3 k W - EFF~c)ENT.

WITH E G Z N W l E 5 O F SCALE, THE

d t N W U N E R S T i ONE OF T E W O R USES OF M W IN SOCIFTY. MONEY SERVES AS A

BIUM OF EXCHA@?5E--W T IS,[* W W T MIE USE 7D BUY WINGS w m ,

7741s MONEY TD W
II
AY FAVORITE
Pk
T 1ik6FK
W W T I E S MUST M a Y n W g
6 EXCHANGE?
TO 5 E M AS IW G F K C T N E .WIU
F l W OF U,IT MUST BE ACCEmABLE To W P L E WWD WNT TO
SELL .
THlNGS SELLERS MLIST E S CONFIDENT T W TME MONEY THEY WE-
,
'

- -.
WILL BE ACMPTAsLE 70 THE+ - m P U 5 F P-O M *.MOM T
m Ibl TUW , 1
wmr m w THINGB;

Fa-
&
m M
St4gllGH-mw Mrlsr
& C E m ,
FiaR 1S
-
m a
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AS mYMEdT
TWT WE &TO
me
sJCrr W E
--
WIXJNSIC W E - - M IS, I r
far CtLXveTQ m s ~
a=m I N G W T HAS I

W e rrJ 1 - 1 3 rn cetW,.
e T I T 5 USE 4s
A MZDIIIM ~ ~ F c Y ~ u A N c ; ~ -
m
I VALUE. THE ANCIENT CHINESE USEP f1
M!WR ABOUT
WT-W T , .
W E Y MUST BE FUIdGiBLE BECAUSE; B E S I D E SERVlf
Z E . 5 AS ST.. DAFD OF VALUE--fFIAT IS, AS A LlN IT
- -
;
hk&
=p.15
THAT WE U S IS mawz hrwc
WPTH T U E S I W W W Y ~ E E
-
WU-A;R.,OLD Am WelJ BlLlS AND COlNS
PRECISELY THE SAW ,

Y M U 3 MONEY & RELATIVE4 STABLE IN VAL[

RVING AS A MED~Ut.4 OF U(CH4NGE AND A5 A
SEpVESAS A STORE O F v A W E - - T M 15, A5
WER.STOPI~\~G U P R~RCWSING PQWER IS w

1 7 1
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I,.
m

m i a.-
- -m
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1
-,

: ~ ~ W P G &
DD WM f m O W S C . W a P E THE W P S Y J C E I M cute
-MY - D U ~ - - THINGS MKE ~ J & U S I ~ ~ G , A N e &
@i g u c A ~ 1 ? 4 % ~a
.
m SGuvkzE5,
ONFLATIONALSO HUETS PEOPLE WHO LEND
MONEY AT INTEEST W E 5 THAT W'T
L W S T W U 4 L THE W T E OF lNFLAT10N .

A 5 1 M U L D HAVE Ba-rfiHT LAST Y E A P

AT
I FISING PRICES ALSC! a 1. 1 LEEA~-E
MCOD O F UNCERTAINTY TgAT CAN Di=GUFAGE
.ZAvldG AND INVESTMENT M 1 1 . 7 t l U M TitE
1A

U M E F COSTS AND !A/K-ES N k L 0 I N G

I MAY N L X E A S L E 7'0
 Glossary
w .
~~dden~d~nil-~~ituatiokhw~two~le~w~twhlt
'I ,

trade, a cofiditionmasaq for barter -to w,,

. . . .- . - 1 .. .%
=. - 2 - ..
'

IDprodudon ir? which Metent wa

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3 % - - '
8
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,.. .I:<+'
..- 1 '
.. A ..

~ e d R&d
= sgd& - The & b a l k of the ~ n i k states.
d The Sgshm cmstsof.ther
. .
:
b -
~-~~~ of Govet.nors-and12 reghid Federal Reme Bank
*

? .
-

P *

m.that
. , SF,* :.

Infhtion - h in- in the gened.price lev&"

Mediumof Exchange -An item that is gentla~yaccepted as p p n t fof. other ~LCUI
serves as the medium of &ee in our eccmomv.
.d
A
,
.

- keconomy; the "".money q l y a m i h b k for

piy The amount m m m q in t

xe&s&~time
. .-
period in whiclietbn~micadivity d~cliae. p-w
. - . .
4
-
A

,.+?.-&.
u
' ."a
Merve Reqrrirements - TIE p k l a g e of deposits that banks are required to keep eidu !+- &+

~ ' s ~ ~ - l h r p f w ~ u c t i o n ~ ~ ~ f d a l l t h e ~ &$$-
d ~ t h a t
I .

&andarddValtu-~nit&& t . d & ~ p r i o m s a h r d & i ~ ; m o p y u n , ~ ' y

.. the standard of value in o h s q u m y (see "Unit of Account;" below). lY
&
.+-=. -
- AIIitm used
ofr ~ a -l m ._-
to m,or to stm, purchasing power
- -. .
we; the main

upk@iqie~;bf w- 4
T h e stmy of Money" are available at no -

~iaul~arel~~ewh~orrnoreinfoma~ortaonier,writeor~

D E W RESERVE BANK OF NEW YORK ba

public ~nformation~epartmcnt
' 33 Liberty Street
dew York, NY 1-
(212)720-6134
Third Mtiq
TQQR