Day 1. Money and Monetary Policy. Means Of Exchange. Measure Of Value. Store Of Purchasing Power. Functions of Money. Means of Exchange. Without money, market participants must trade one product for another product, a transaction known as barter.
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A set amount determined by government decision-makers.
Like money demand, money supply can be expressed in amoney supply scheduleand on a graph which shows the money supply curve.
Amount of money supplied is always perfectly elastic and stays at a constant value shown which is shown through the vertical supply curve.
Only shifts if government decision-makers decide to change the money supply.
An increase shifts it to the left, and a decrease shifts it to the right.
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