Quanto você precisa esperar que você vai pagar por um bem money
Quanto você precisa esperar que você vai pagar por um bem money
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It is not necessarily useful—you can't eat gold, and it won't keep you warm at night, but the majority of people think it is beautiful, and they know others think it is beautiful. So, gold is something that has worth. Gold, therefore, serves as a physical token of wealth based on people's perceptions.
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Impressions Create Everything The second type of money is fiat money, which does not require backing by a physical commodity. Instead, the value of fiat currencies is set by supply and demand and people's faith in its worth.
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At this time both silver and gold were considered legal tender, and accepted by governments for taxes. However, the instability in the ratio between the two grew over the 19th century, with the increase both in the supply of these metals, particularly silver, and of trade. This is called bimetallism and the attempt to create a bimetallic standard where both gold and silver backed currency remained in circulation occupied the efforts of inflationists.
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, meaning cattle. The development of money has been marked by repeated innovations in the objects used as money.
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The basic function of money is to enable buying to be separated from selling, thus permitting trade to take place without the so-called double coincidence of barter. In principle, credit could perform this function, but, before extending credit, the seller would want to know about the prospects of repayment.
It took years to get all the foreign coins as well as competing state and local bank currencies out of circulation. Banks issued their own notes during this time period, which was technically illegal as only Congress and the federal government had this power.
If the Fed wants to increase the amount of money in circulation, perhaps to boost economic activity, the central bank can, of course, print it. However, the physical bills are only a small part of the money supply.
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