What are the forms/characteristics of money
- Medium of exchannge
Universally accepted eans of payments - Store of value
Does not depriciate but it does change in ourchasing powerr - Unit of account
Common standard for measuring/ commin denominator - Stabdard deffered oayment
Can be used in future trabsactions like loans which are monetary terms
First coin used by ancient filipinos
Gold barter ringa
First paper money by el banco espaniol filipino whom is the furst cebtral bank
Peso fuertes
Current medium of exchange
Philippines peso or paper mkney
Differenr forms of miney
- Commodity miney
- physical goods
2, diat miney
- gov, issued currency
- Credit mkney
- future monetary claims like ious, bknds
4, p plastic money
- hard plastuc cards like debut and credit cards
Central monetary authority in the ph
Bangko central ng pilipinas
Posses fiscal and logistical autonomy from the gov. In the execution pf its mandated obligations
Bangko sentral ng pilipinas
What are the functions and responsibility of BSP
- Regulate the money supply in the economy
- Issue pesos bills in exchange for foreign currency
- Safe depository of publicnfunds
- Imposes reserve requirement sytem among banks
- Controls and decides whether to lend moneyy to the national gov.
What is monetary poolicy for?
Stabalize inflation rate and have balanced economic growth
What is the main goal of expansionary monetary policy
- Increase in money supply
2, lower interest rates
3, stimulate investments
4, increae in aggregate demands
What are the three methods jn expansionary monetary policy?
- Decreasing reserves
Allowas commercial banks to lend more through lowns, stimulatung consumption expenditure and aggregate demand
2, lowering discount rates
Encourages central bankds and institutions to borrow, increasing funds available for lending, thereby purchasing power and consumption expenditure. As individuals a
Can borrow money easier
- Open market operations (. Purchase treasury bonds
Pressure banks to release more money into the economy leading consumption expenditure and aggregate demand thereby increasing consumption
What are the three methods in contractionary monetary policy?
- Increasing reserves
Reduce money supply through making borrowjng money on banks harder, leading to decrease consumption and eventually lower prices - Raising discount rates
Discourage borrowingt hrought increasing interest rates , reducing funds available for lending and consumptiom
3, open market operations ( selling bonds)
Widthraw money from the system, sell bonds to decrease consumer’s spending thereby lowering down economic activity
What are the goals of contractionary monetary policy?
1, reduce money suppky
2, increase in interest costs
3. Fewer investmebts and aggregate demand
