Whatever Happened To Penny Candy Ch 4

What are the primary materials that have historically been used as money?

What characteristic does good money primarily need to possess?

What invention helped solve the problem of knowing how much gold or silver one possessed?

Why do people consider gold and silver special beyond their monetary value?

What is typically included on a real coin to indicate its authenticity?

What does the term 'thaler' originally refer to?

Which problem did the invention of money warehouses aim to solve?

What is a Silver Certificate in the context of past U.S. currency?

What caused the U.S. dollar to lose its popularity after the 1960s?

What was Kublai Khan's legal tender law designed to do?

Which of the following statements about Federal Reserve Notes is true?

During the Revolutionary War, what happened to Continental dollars?

What consequence did refusing to accept paper money have in 1790s France?

What does the phrase 'legal tender' refer to?

What was the original meaning of the British Pound Sterling?

Dollar's History and Evolution

A dollar isn't a piece of paper; it's an ounce of silver.
Gold and silver have been used as money for millennia due to their durability, scarcity and wide desirability
Money must be easily traded, portable, widely accepted, and resistant to corrosion.
Many unusual items have been used as currency, including stones, cattle, beads, salt, fish, and shells.
Coins solved the issue of determining the weight and purity of gold or silver by stamping the weight, fineness, and mint's name on them.
The Joachimthaler, a one-ounce silver coin, was widely used in the Middle Ages, leading to the term "thaler", later shortened to dollar.
Other currencies are also based on weights of precious metals (e.g., pound sterling, French franc, shekel).
Money warehouses (banks) provided a safe place to store money.
Banknotes (IOUs) represented stored precious metals, evolving into paper money in the US.
Until the 1960s, US dollars were "Silver Certificates," redeemable for silver.
Today's US dollar is a "Federal Reserve Note," not backed by precious metals; its value comes from a legal tender law.

Legal Tender and Fiat Money

Kublai Khan used legal tender laws to force acceptance of paper money (fiat money) in exchange for goods.
The French government used similar methods, enforcing paper money's acceptance with extreme measures.
US legal systems have a similar "legal tender" system.
The "legal tender" status makes US dollars accepted in payment, in most circumstances, preventing refusal without penalty

Inflation and the Value of Money

Inflation occurs when a government prints too much paper money without sufficient precious metals to back it.
Historical examples show that inflated paper money loses value, while stable, convertible currencies retain their worth.
The value of money is determined by people's willingness to accept it in trade.
The author attributes economic problems to corruption in the legal system, suggesting that an idealized system isn't supported by contemporary legal frameworks.

Explore the fascinating journey of the dollar, from its origins in precious metals to its role in modern economies. This quiz covers the transition from coins to paper money, the impact of banks, and the unique items that have served as currency throughout history. Test your knowledge of monetary evolution and its significance.