WHAT IS MONEY? WHAT IS A BANK?

ECONOMY – ECONOMICS – ECONOMIC RELATIONS

Most people work in order to earn for their living. We get salary for our work. So, every day we take part in economic relations. We read advertisements and by things in the Internet, we order pizza, go to the Art Galleries, Libraries and Theatres.

WHAT IS ECONOMY?

Economic relations develop when a buyer and a seller meet to change things they have. Economy is a system that works to satisfy our needs in goods. We buy food, clothes and many other things we need to live. And we sell things to get money. Thus, we are involved in every day economic relations. We are consumers and we are producers.

WHAT DO WE BUY?

We can buy goods and services. Some people buy goods, some people buy services. We buy goods in the shops and markets. Where do we buy services? We buy services at schools, universities, in a cinema and art gallery, museums, hospitals, etc. Sometimes we can buy goods and services at the same place. For example in the garage we can buy a car and some services to maintain it.

WHAT IS A MARKET?

Market is a place where a buyer and a seller meet each other to buy and to sell. So, when they start market relations they involve other people in advertisement, making contracts, delivery and service, etc.

WHAT IS ECONOMICS?

Economics is a science to learn economic relations and market. How to make economic relations more flexible? What are the ways to develop market and promote goods? What kinds of business are perspective and why? Economics answers all these and many other questions.

WHAT IS MONEY? WHAT IS A BANK?

We use money to buy and sell goods, to pay bills and to get salary. Workers are paid by money for their work. So, money is economic stimulus and a measure of exchange in economic relations.

A bank is a company that works with the money that the people give it. If you give your money to a bank, it not only protects it but pays you interest so that it can work with the money. This is one of the reasons why people save their money in a bank. Money may also be safer there than at home.

Banks also lend money to other businesses and customers. They collect extra money called banking fees with which they pay interest to savers as well as salaries for their workers. Banks make a profit because they collect more interest than they pay to savers.

Without banks the world’s economy would not be able to grow. Investors would not find the money they need for new projects. Industries could not buy new machines and modern technology.

Date: 2015-12-24; view: 5555