MONEY AND ITS SIGNIFICANCE IN THE ECONOMY

How is money significant in our economy?

Money is absolutely necessary to the development of commerce and trade.
It

could not function without the use of money. It stimulates production in creation of wealth and economic goods. It increases standard of living

What is Monetary Standard?

Monetary Standard is a particular type or kind of standard money used in the monetary system of a country and to which other kinds of money are related.

Significance of Monetary Standard

It serves as the domestic requirement of the country, that is, filling its internal needs. It serves as the requirement of international trade.

Conditions for Satisfactory Monetary System

Media of payments must exist in forms and denominations that provide convenience for the numerous payments that have to be made within the country. All these forms of money must circulate and at parity with one another.

Money Supply Measurement

Money in circulation Savings and demand deposits Money market funds Short term repurchase agreement

Value of Money

The amount of goods and services Purchasing power Revealed by general prices.

Functions of Money

Money as the medium of exchange Money as a measure of standard value Money as a store of value
Savings Investing

Money as a means of debt payment

Characteristics of Good Money

General Acceptability Portability

It

should not only be easy to carry but also command great values contain in small bulk. is easy recognized to help minimize counterfeiting and eliminate confusion.

Cognizability
It

Durability
It

is intended to be durable to cover long periods of time. into fraction, each fraction is a centavo.

Divisibility
Divided

Malleability
Must

be capable of being stamped with proper design.

Elasticity
The

volume of money in circulation could be easily increased or reduced in accordance with the need as well as the dictate of the economy.

Convertibility
Converted

into foreign money or currency.

Recognizing our Money

Steps in recognizing genuine BSP notes

Paper
It

is rough Includes (watermark, security fibers, security threads, and iridescent band)

Watermark

It is the silhouette of the portrait appearing on the face of the note. The contours of the features of the silhouette can be felt by running the fingers over the design on relatively new notes.

Security Fibers

Embedded red and blue visible fibers are scattered at random on both surfaces of a genuine note and can be readily picked off by means of any pointed instrument.

Embedded Security Thread

It is a special thread vertically implanted off center of the note during paper manufacturer. This can be easily seen when the note is viewed against the light. It appears as a broken line for 5s, 10s. ad 20s and others

Window Security Thread

A wide glistening gold vertical stripe with the numerical value printed in series.