Principles of Economics 2e
Principles of Economics 2e
2nd Edition
ISBN: 9781947172364
Author: Steven A. Greenlaw; David Shapiro
Publisher: OpenStax
Textbook Question
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Chapter 27, Problem 1SCQ

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?

Expert Solution & Answer
Check Mark
To determine

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.

Economics Concept Introduction

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.

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In many casinos, a person buys chips to use for gambling. Within the casino's walls, customers often can use thesechips to buy food and drink or even a hotel room. Do chips in a gambling casino serve all three functions of money?
In many casinos ,a person buys chips to use for gambling.Within the casino 'swalls, 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?
why can't food be used as a form of money?

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Principles of Economics 2e

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