Professional Documents
Culture Documents
MARKET &
MANAGEMENT
BA422
CHAPTER 1
ROLE OF MONEY
IN OUR ECONOMIC
SYSTEM
DEVELOPMENT OF MONETARY
SYSTEMS
Money is anything used by society as a
medium of exchange, and is widely
acceptable for the payment of good and
services without questioning the integrity of
the person offering it.
In the Philippines, money supply consists of
deposit money that is withdrawable by
means of checks and currency, which
consist of notes and coins.
EVOLUTION OF MONEY
SIGNIFICANCE OF MONEY
It has a tremendous power over economic
goods.
Businessmen go into production and trade
because of money profit. When people
deposit their money in banks, and the banks
in turn lend money to borrowers for
productive purposes, this induces
employment, which generates consumption,
thereby encouraging more production, which
leads to a multiplier effect and results to
progress in the economy.
FUNCTIONS OF MONEY
1. As a medium of exchange: As a medium
of exchange, money enables goods and
services to be transferred from person to
person. It is a way of exchange or a means
of exchange.
2. As a standard to measure the value of
goods and services: Money measures the
valued to goods and services. It is used as a
yardstick in the pricing of things. The
monetary unit of the country is used as a
standard of value.
ATTRIBUTES OF GOOD
MONEY
KINDS OF MONEY
1. Commodity Money This is the type of
money that has a commodity value or a
value of its own. In order for it to circulate,
the commodity value should equal its
money value.
2. Credit Money This is the credit
instrument that is widely acceptable in
payment for goods and services and in the
settlement of existing debts and
obligations.
COINAGE
It is the process of making uniform coins from
metals and stamping them with a specific
design as a guaranty of its weight and
fineness and the integrity of the country it
represents.
The coin is the product of coinage. It is
defined as a mass of metal cast in some
convenient shape with a definite weight and
fineness, which is guaranteed by the
government and certified by the integrity of
the design impressed upon its surface.
KINDS OF COINAGE
GRATUITOUS COINAGE or FREE COINAGE is
a system where by money metals or metals
may be brought to the government mint
and converted into standard money without
any charge or any expense for minting
except for the delay involved in the process.
BRASSAGE is a kind of coinage where the
fee charged by the government to mint
metals into coins is just sufficient to cover
the cost of minting.
DETECTING COUNTERFEITED
BILLS
NOTES
1. Paper
2. Portrait
3. Watermark
4. Security Fiber
5. Security Thread
6. Background Design
7. Color of each denomination
8. Style and size of serial number
9. Vignette
10. Cleanness of print
COINS
1. Even flow of metallic grains
2. High relief of letter and numerals
3. Regularity of reedings and beadings
A. NOTES
2. PORTRAIT
Appears life-like. The eyes
sparkle. The tiny dots forming
the details of the face, hair, etc.,
are clear, sharp and will defined.
Each portrait stands out
distinctly from the background.
This is very noticeable along
shoulders.
3. WATERMARK
The watermark is the same as
the colored portrait. This design
is placed during the
manufacture of the paper. Sharp
details of the outline of the light
and shadow effect are
discernable when viewed with
the aide of a transmitted light.
The relief of the features can be
felt by running the fingers on
the design.
4. SECURITY THREAD
This is a special thread placed
vertically on the paper during
manufacture.
5. SECURITY FIBERS
Red and blue fibers are
scattered at random on both
surfaces and can be readily
ppicked off by means of any
pointed instrument.
6. BACKGROUND DESIGN
The background designs are
multi-colored and are composed
of sharp lines, which are
continuous and traceable even
at the joints.
8. SERIAL NUMBER
The prefix(s) and numbers (six
of them except on replacement
note) are clearly printed. They
have a peculiar style and are
uniform in size and thickness.
Spacing of the numbers is
uniform and alignment is even.
9. VIGNETTE
The lines and dots composing
the vignette are fine, distinct
and sharp; the varying color
tone give a bold look to the
picture that make it stand out
of the paper.
B. COINS
Genuine coins show an even
flow of metalllic grains. The
details of the profile, the seal of
the Republic of the Philippines,
letterings and numerals are of
high relief, that they can be
readily felt distinctly by running
the fingers on these features.
The beadings composed of tiny
stars on the ABL series and dots
on the Pilipino series are regular
and the reedings are deep and
even.