Lecture Business (4/e): Chapter 15 - Ferrell, Hirt, Ferrell

Part 6
Financing the
Enterprise

© 2015 McGraw­Hill Education.


15-2

 
CHAPTER 14

Accounting and Financial Statements

CHAPTER 15

Money and the Financial System

CHAPTER 16

Financial Management and Securities Markets


15-3

Learning Objectives
LO 15-1 Define money, its functions, and its characteristics.
LO 15-2

Describe various types of money.

LO 15-3
the

Specify how the Federal Reserve Board manages
money supply and regulates the American banking
system.

LO 15-4
and

Compare and contrast commercial banks, savings
loan associations, credit unions, and mutual savings
banks.

LO 15-5

Distinguish among nonbanking institutions such as
insurance companies, pension funds, mutual funds,
finance companies.

and

LO 15-6
Investigate the challenges ahead for the banking
industry.


15-4

Money in the Financial System

•

Medium of exchange
Before fiat
money, the trade
of goods and
services was
accomplished
through bartering

•

•

Trading one good or service for another of
similar value
Inefficient because not always divisible and can
be complicated in multiple-party transactions


15-5

Functions of Money

To be used as a medium of exchange,
money must have:
•

Acceptability

•

Stability

•

Divisibility

•

Durability

•

Portability

•

Difficult to counterfeit


15-6

Types of Money
Paper Money and Coins


15-7

Types of Money


15-8

Financial Systems


15-9

Four Main Monetary Policy Tools


15-10

Other Regulatory Functions of the Fed


15-11

Banking Institutions


15-12

Insurance for Banks


15-13

Nonbanking Institutions


15-14

Nonbanking Institutions


15-15

Electronic Banking