What Money Actually Is — slides
Financial Literacy Club
Money Fundamentals · Lesson 1
What Money Actually Is
Why money exists, the three jobs it does, and how to think about prices in hours of your time.
10-minute lesson · learnwithflc.org
What Money Actually Is · 1 / 20
Financial Literacy Club
Money Fundamentals · Lesson 1
What Money Actually Is
Why money exists, the three jobs it does, and how to think about prices in hours of your time.
10-minute lesson · learnwithflc.org
Today's goals
By the end of class, you'll be able to…
- Explain the barter problem and how money solves it
- Identify money's three jobs: medium of exchange, unit of account, and store of value
- Convert a price into hours of work using take-home pay
Warm-up
You have 20 apples and need a pair of shoes — but there's no money. Write down every step it would take to get the shoes.
Think, then write your answer.
The big idea
What Money Actually Is
Why money exists, the three jobs it does, and how to think about prices in hours of your time.
Money Fundamentals · Lesson 1
Imagine you grow apples and need shoes. Without money, you'd have to find a shoemaker who happens to want apples — right now, in the amount you have. That's called barter, and it breaks down fast.
Money Fundamentals · Lesson 1
Money fixes this. You sell apples to anyone who wants them, then use the money to buy shoes from anyone who sells them. One hard trade becomes two easy ones.
Vocabulary
Money
Anything people widely accept in exchange for goods and services. Its value comes from shared trust that others will accept it too.
Money Fundamentals · Lesson 1
The U.S. dollar isn't backed by gold. It works because people, businesses, and the government accept it — taxes, for example, must be paid in dollars. And most dollars today aren't paper at all: they're digital balances in bank accounts, moved by cards, direct deposit, and apps.
Money Fundamentals · Lesson 1
Here's the most useful way to think about money as a student: money is stored time. When you earn $12 an hour, a $60 purchase costs you five hours of your life. That doesn't mean never spend — it means you can see the real trade you're making.
See it
Money does three jobs: it's a medium of exchange you can trade for things, a unit of account used to measure prices, and a store of value that lets you save now and spend later.
- 1
Medium of exchange
You can trade it for almost anything, so you don't need to barter.
- 2
Unit of account
Prices are measured in it, so you can compare a $4 coffee to a $40 game.
- 3
Store of value
You can save it and spend it later — though inflation slowly shrinks what it buys.
Real example
Pricing things in hours
Maya works part-time and takes home about $12 an hour after taxes. She's looking at $180 sneakers.
- $180 ÷ $12 per hour = 15 hours of work
- That's about two full Saturday shifts
Maybe the sneakers are worth two Saturdays to her. Maybe not. The point isn't guilt — it's clarity. Once she sees the price in hours, the decision is actually hers.
Try it together
Try it: what does it cost in hours?
Enter your take-home pay per hour and the price of something you want.
Your numbers
After taxes.
Results
Real cost in your time
15 hours
$180 ÷ $12.00 per hour
In 4-hour shifts
3.8
In 8-hour workdays
1.9
Activity · whole class · 12 min
Barter Market
- Hand each student a card with one item they HAVE (e.g., bread, a bike repair, tutoring) and one item they WANT.
- Round 1 (4 minutes): students may only trade by barter — one item for another. No promises, no IOUs.
- Count how many students got what they wanted. Ask what made trades hard (finding someone who wants exactly what you have, right now).
- Round 2 (3 minutes): give everyone 10 paper 'class dollars' and let them sell and buy freely.
- Compare results and connect each difficulty from Round 1 to one of money's three jobs.
Check for understanding · 1 of 3
You want to trade your old video game for a friend's jacket, but your friend doesn't want the game.
How does money solve this problem?
- AIt makes the jacket cheaper.
- BYou can sell the game to anyone, then buy the jacket with the money.
- CIt guarantees the game will keep its value.
- DIt means you no longer need to agree on a price.
B. You can sell the game to anyone, then buy the jacket with the money.
Barter only works if both people want what the other has. Money splits one hard trade into two easy ones: sell to whoever wants the game, buy from whoever sells the jacket.
Check for understanding · 2 of 3
Most money in the U.S. today exists as physical cash.
- True
- False
False
Most money exists as digital balances in bank accounts. Cash is only a small share of the money in the economy.
Check for understanding · 3 of 3
You take home $12 an hour after taxes. Concert tickets cost $90.
Thinking in hours of work, what do the tickets really cost you?
- A6 hours
- B9 hours
- C7.5 hours
- D12 hours
C. 7.5 hours
$90 ÷ $12 per hour = 7.5 hours. Use take-home pay, not your pay before taxes.
Remember
Key takeaways
- Money solves the barter problem — you don't need to find someone who wants exactly what you have.
- Money does three jobs: medium of exchange, unit of account, and store of value.
- Most money today is digital, not cash.
- Price ÷ hourly take-home pay = the real cost in hours of your time.
Discuss
Talk it over
- If everyone suddenly stopped trusting the dollar, what would happen to its value? Why?
- Pick something you bought recently. Was it worth the hours of work it cost?
Exit ticket
Name money's three jobs and give an everyday example of one.
Answer on your exit ticket before you leave.
Nice work today.
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