Learning Objectives

After reading this chapter, you should be able to:

• Define money, its functions, and its characteristics.

• Describe various types of money.

• Specify how the Federal Reserve Board manages the money supply and regulates the American banking system.

• Compare and contrast commercial banks, savings and loan associations, credit unions, and mutual savings banks.

• Distinguish among nonbanking institutions such as insurance companies, pension funds, mutual funds, and finance companies.

• Investigate the challenges ahead for the banking industry.

• Recommend the most appropriate financial institution for a hypothetical small business.