money

Question 1

money

Answer 1

medium of exchange consisting of bank notes and bank deposits or anything else than can be used to purchase goods and servised

Question 2

money is accepted as payment because others can use it for the same purpose

Answer 2

money requires trust to function, it is usually provided by governments and banks
it is a social institution that provides a solution to the problem of a lack of trust

Question 3

disposable income (income tout court)

Answer 3

amount of money received as profit, interest, rent, labour earnings (wages and salaries) and other payments (including transfers) net of taxes, over a period of time

measured over a period of time

Question 4

wealth

Answer 4

market value of the stock of assets owned, including real assets (buildings, land, capital goods) and financial assets (shares or bonds), net of outstanding debts (morgages)

measured at a point in time

Question 5

net income

Answer 5

gross income minus depreciation of real assets

maximum amount that you could consume and leave wealth unchanged

Question 6

saving

Answer 6

occurs when consumption expenditure is less than income

Question 7

wealth

Answer 7

is the accumulation of past and current savings

Question 8

break even price

Answer 8

maximum price p that an individual is willing to pay for an IOU

Question 9

borrowing

Answer 9

allows us to buy more now, but constraints us to buy less later