Foreign exchange  Volume 2

Foreign exchange Volume 2

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This historic book may have numerous typos and missing text. Purchasers can download a free scanned copy of the original book (without typos) from the publisher. Not indexed. Not illustrated. 1908 Excerpt: ...general acceptability. Currency includes not only gold, but United States notes, bank notes, silver dollars, and small coins. The currency of a country embraces both its money and fiduciary money. Cash is practically synonymous with currency. 5. General Terms.--Utility is the power of a good to satisfy a want. A thing must not necessarily be useful in order to possess utility in the economic sense. Value means purchasing power; nothing has value unless it has utility and unless there is a demand for it greater than the supply. Price is the amount of money for which a thing will exchange; it is the value of a thing in terms of money. Commodity in the economic sense is applied to such things as possess utility. Good is a synonym of commodity. By leffal tender is meant any instrument of exchange that the law compels creditors to accept. Lawful money is such as the National Bank Act requires the banks of the United States to keep in their reserves; it includes gold and all kinds of fiduciary money except bank notes. Barter is an exchange of goods without the use of money or credit. FUNCTIONS OF MONEY 6. Money as the Standard of Value.--The primary and fundamental utility of money is found in its service as a medium of exchange. As money is the measure by which the prices of goods are compared, it is called the standard of value; and as money is a variable standard, the use of it enables the values of goods to be compared only at a given time. There can never be a rise or fall in the value of all commodities at the same time, for if the values of some rise, the values of others must decline. All prices, however, may rise or fall, for the value of money may change. It is price that enables the values of goods to be compared. Strictly speaking, money has no price....