
In many casinos, a person buys chips to use for gambling. Within the casinos wafts, customers often can use these chips to buy food and drink or even a hotel room. Do chips in a gambling casino serve all three functions of money?

Whether the use of chips in gambling serves the functions of money or not is to be determined.
Explanation of Solution
It is assumed that the person buys the chips which can be used for gambling. If the chips are maintained within the walls of casino then, it would serve all the three functions of money which are medium of exchange, a unit of account and store of value. In the case of medium of exchange, chips can be used both by the buyer and seller. The seller can sell the drinks and food in exchange of chips within the casino.
In the case of unit of account, it can be used through which other goods can be measured. A common denominator is set and used for goods and services. In the case of store of value, money is used to buy the products and services in future. Hence, chips were also used in order to buy food and beverages in future.
Money supply is defined as the aggregate of the money which is available in the economy at a specific time period. It is mainly regulated by the government and the other financial bodies. In order to make the change in the money supply, both the expansionary and Contractionary policies are used. M1 and M2 are the measures of money supply.
Want to see more full solutions like this?
Chapter 14 Solutions
Principles of Macroeconomics 2e
Additional Business Textbook Solutions
Foundations Of Finance
MARKETING:REAL PEOPLE,REAL CHOICES
Gitman: Principl Manageri Finance_15 (15th Edition) (What's New in Finance)
Business Essentials (12th Edition) (What's New in Intro to Business)
Horngren's Accounting (12th Edition)
Financial Accounting, Student Value Edition (5th Edition)
- 17. Given that C=$700+0.8Y, I=$300, G=$600, what is Y if Y=C+I+G?arrow_forwardUse the Feynman technique throughout. Assume that you’re explaining the answer to someone who doesn’t know the topic at all. Write explanation in paragraphs and if you use currency use USD currency: 10. What is the mechanism or process that allows the expenditure multiplier to “work” in theKeynesian Cross Model? Explain and show both mathematically and graphically. What isthe underpinning assumption for the process to transpire?arrow_forwardUse the Feynman technique throughout. Assume that you’reexplaining the answer to someone who doesn’t know the topic at all. Write it all in paragraphs: 2. Give an overview of the equation of exchange (EoE) as used by Classical Theory. Now,carefully explain each variable in the EoE. What is meant by the “quantity theory of money”and how is it different from or the same as the equation of exchange?arrow_forward
- Zbsbwhjw8272:shbwhahwh Zbsbwhjw8272:shbwhahwh Zbsbwhjw8272:shbwhahwhZbsbwhjw8272:shbwhahwhZbsbwhjw8272:shbwhahwharrow_forwardUse the Feynman technique throughout. Assume that you’re explaining the answer to someone who doesn’t know the topic at all:arrow_forwardUse the Feynman technique throughout. Assume that you’reexplaining the answer to someone who doesn’t know the topic at all: 4. Draw a Keynesian AD curve in P – Y space and list the shift factors that will shift theKeynesian AD curve upward and to the right. Draw a separate Classical AD curve in P – Yspace and list the shift factors that will shift the Classical AD curve upward and to the right.arrow_forward
- Use the Feynman technique throughout. Assume that you’re explaining the answer to someone who doesn’t know the topic at all: 10. What is the mechanism or process that allows the expenditure multiplier to “work” in theKeynesian Cross Model? Explain and show both mathematically and graphically. What isthe underpinning assumption for the process to transpire?arrow_forwardUse the Feynman technique throughout. Assume that you’re explaining the answer to someone who doesn’t know the topic at all: 15. How is the Keynesian expenditure multiplier implicit in the Keynesian version of the AD/ASmodel? Explain and show mathematically. (note: this is a tough one)arrow_forwardUse the Feynman technique throughout. Assume that you’re explaining the answer to someone who doesn’t know the topic at all: 13. What would happen to the net exports function in Europe and the US respectively if thedemand for dollars rises worldwide? Explain why.arrow_forward
- Economics Today and Tomorrow, Student EditionEconomicsISBN:9780078747663Author:McGraw-HillPublisher:Glencoe/McGraw-Hill School Pub CoMacroeconomics: Private and Public Choice (MindTa...EconomicsISBN:9781305506756Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage LearningEconomics: Private and Public Choice (MindTap Cou...EconomicsISBN:9781305506725Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage Learning





