Financial Literacy
Standard 1.0:
Assess the role of money in financial literacy
Role and functions of money in the economy:
1.1.1: Origins of money and its role in the economy.
How has the use of money changed our
economy?
Average Cost Of New Home Homes
1930 $3,845.00 , 1940 $3,920.00, 1950 $8,450.00 , 1960 $12,700.00 ,
1970 $23,450.00 , 1980 $68,700.00 , 1990 $123,000.00 , 2008 $238,880 , 2013 $289,500 ,
Average Wages
1930 $1,970.00 , 1940 $1,725.00, 1950 $3,210.00 , 1960 $5,315.00 ,
1970 $9,400.00 , 1980 $19,500.00 , 1990 $28,960.00 , 2008 $40,523 , 2012 $44,321 ,
Average Cost of New Car Cars
1930 $600.00 , 1940 $850.00, 1950 $1,510.00 , 1960 $2,600.00 ,
1970 $3,450.00 , 1980 $7,200.00 , 1990 $16,950.00 , 2008 $27,958 , 2013 $31,352 ,
Average Cost Gallon Of Gas
1930 10 cents , 1940 11 cents , 1950 18 cents , 1960 25 cents ,
1970 36 cents , 1980 $1.19 , 1990 $1.34 , 2009 $2.051 , 2013 $3.80 ,
Average Cost Loaf of Bread Food
1930 9 cents , 1940 10 cents , 1950 12 cents , 1960 22 cents ,
1970 25 cents , 1980 50 cents , 1990 70 cents , 2008 $2.79 , 2013 $1.98 ,
Average Cost 1lb Hamburger Meat
1930 12 cents , 1940 20 cents , 1950 30 cents , 1960 45 cents ,
1970 70 cents , 1980 99 cents , 1990 89 cents , 2009 $3.99 , 2013 $4.68 ,
Some of the above can be explained due to the inflation over 80 years , but there are also many other reasons why some prices
increased dramatically ( Housing Bubbles. Middle East Wars, Weather problems causing food price inflation, Population explosion,
) it also can work the other way due to improvements in technology offering much cheaper goods for example TV's, Calculators,
Computers ETC.
1.1.2 Roles of the U.S. Treasury and the Federal
Reserve in establishing monetary policy.
The Department of the Treasury operates and maintains systems that are critical to
the nation’s financial infrastructure, such as the production of coin and currency, the
disbursement of payments to the American public, revenue collection, and the
borrowing of funds necessary to run the federal government.
● Managing Federal finances
● Collecting Taxes, duties and monies paid to and due to the U.S. and paying all
bills of the U.S.
● Currency and Coinage
● Managing government accounts and the public debt
● Supervising national banks
● Advising on domestic and international financial policy
● Enforcing Federal finance and tax laws
● Investigating and prosecuting tax evaders, counterfeiters, and forgers.
Federal Reserve System: The central bank of
the United States. Created by Congress to provide the
nation with a safer, more flexible, and more stable
monetary and financial system.
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Conducting the nation’s monetary policy by influencing money and credit
conditions in the economy in pursuit of full employment and stable prices.
Supervising and regulating banks and other financial institutions to ensure
safety and rights of consumers
Maintaining the stability of the financial system
1.1.4:
Explain a Cashless society
Pros
Cons
Security: Easy to shut down a digital wallet
remotely, and a biometric ID is hard to copy.
Hackers: Don’t lose your phone
Convenience: Eliminates the need to carry cash or
plastic...Tap or wave your smartphone...easier to
loan or borrow money
Failure Rates: glitches
1% of 100 million = 1 million
Taxes
Taxes are spent on many different things. They are used for public spending,
which means spending on public property - on institutions and services that
are not privately owned.
So the taxes you pay are used to pay for:
● transport
● education
● health
● law and order
● housing
● culture, media and sport
● trade and industry
● environment, food and rural affairs
● overseas development and defense.
1.2 Examine the relationship between
income and career choice.
Explain career opportunities in finance and financial planning…
What does a finance worker do?
In personal finance, decisions are made about paying for education, financing goods such as
real estate and vehicles, buying health and property insurance, and investing and saving for
retirement. According to the Financial Planning Standards Board, the six key areas of personal
financial planning are:
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Financial position: understanding what resources are available by looking at the net
worth and cash flow of a household
Adequate protection: the analysis of how to protect a household from unforeseen risks
Tax planning
Investment and accumulation goals
Retirement planning
Estate planning
Corporate finance is all about providing the funds for a business' activities. Finance managers:
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Balance risk and profitability
Study and forecast economic trends
Review company reports and suggest efficiencies
Work to maximize stock value
Manage funds, including choosing a portfolio of investments
Apply principles of financial risk management
Public finance is concerned with the financial dealings of states, as well as related public entities
such as school districts or government agencies.
Some typical arenas for working in finance include in actuary (insurance), corporate finance or real
estate, financial planning, investment banking and money management. Many of the skills and
abilities needed for each area overlap and can benefit you as you move further in your field, or
decide to change your focus.
Pay Stubs