$$$MONEY$$$

1
MONEY

• PLVS
• FALL 2007

2
AMERICANS SHOULD KNOW

• What happens to money that is torn or worn?
• What is the difference between a Federal Reserve
  note and a United States note?
• What are the functions of money?

3
FUNCTIONS OF

• Medium of exchange (acceptable by all)
• Store of value (savings)
• Unit of account (compare prices)
• Standard of deferred payment (claim on
  goods/services that can be exercised now or later)

4
PAPER MONEY

• All paper money regardless of issue date is
  still legal tender

5
Federal Reserve Notes

• 99 of our money
• Current Denominations 1, 2, 5, 10, 20, 50,
  100
• Before 1945 500, 1,000, 5,000, 10,000
• July 14, 1969Denominations of 500 and larger
  were retired
• Treasury seal serial numbers are green

6
United States Notes

• Make up less that 1 of currency
• Since 1969, only 10 denominations have been
  issued.
• Prior to 1969, 2 and 5 were issued.
• 1966, 2 discontinued
• 1968, 5 discontinued
• Treasury seal and serial numbers are printed in
  red.

7
UNFIT MONEY

• Average life of 1 bill is 17-18 months
• Larger denominations usually last longer
• Old, worn, torn, or soiled money is sent to the
  Federal Reserve Bank to be exchanged for new

8
FEDERAL RESERVE

• Receive from commercial banks and others
• Decides if it is fit or unfit
• Fit is stored
• Unfit is destroyed by machines that shred it to
  1/16 of an inch
• About 1/3 are unfit