SEPTEMBER 6 , 2012

Money Through the Ages

Key Words

Self-sufficientSpecializationDivision of labourBarteringDouble coincidence of wantsDeferred paymentToken moneyFace value

What is Money?

Bills and coinsUsed to exchange for goods or services, or to

pay a debt

Why Do We Need Money?

We are not self-sufficient.The need for specialization and exchange.Specialization was the first step towards a

wealthier society.Division of labour = Specialization

How Specialization Began

Task

Discuss as many advantages and disadvantages of self-sufficiency and specialization as you can think of.

Advantages Disadvantages

Self-Sufficiency

Advantages Disadvantages

Specialization

Question

How did people trade in the past without money?

Before money was invented, people used…

Bartering

Problems with Bartering

Fixing a rate of exchangeFinding someone to swap with

Double coincidence of wants = two people can barter when they both want the good that the other person has.

Trying to save

The Functions of Money

A medium of exchange No need for double coincidence of wants

A measure of value Helps to avoid fixing prices of goods and services in

terms of all other goods and services.A store of value

Allows people to save in order to make purchases at a later date.

In times of inflation, money will fail to be such a good store of value.

A means of deferred payment

Money Sense

‘Money makes the world go round?’ Do you agree or disagree with this statement? Why?

Money Sense

‘Money doesn’t bring happiness’. Do you agree or disagree with this statement? Why?

Money Matters

Money matters!It affects the life choices we make.Money is … a form of energy that tends to

make us more of who we already are, whether it’s greedy or loving. By Dan Millman, athlete and author

What Makes A Good Money?

Get into groups and discuss which of the items below would make a good money. Record the views and present your arguments to the class.

MountainsCheese

CigarettesGold

What Makes A Good Money

Acceptability – Everyone accepts it. That’s why our present money is a token money – a piece of paper or metal coin worth much less than the face value printed upon it.

DurabilityPortabilityDivisibility. E.g. a whole car is worth much

more than two halves. Hence, we divide money into smaller values.

Scarcity

References

Clifford, T. (2009). Money through the ages. Vero Beach, FL: Rourke Publishing LLC.

Einspruch, A. (2011). Money sense. Managing money. South Yarra, Australia: Macmillan Education Australia Pty Ltd.

http://www.historyforkids.org/learn/economy.money.htm

http://library.thinkquest.org/C004203/economic01.htm

http://www.pbs.org/wgbh/nova/moolah/history.html