Core knowledge points in finance and accounting, and self-survey questions (with answers) the following is a systematic compilation of core knowledge from basic concepts to practical application, taking into account theoretical logic and real financial practice, based on the seven pillars of monetary and credit, financial markets, financial institutions, monetary policy, international finance, financial risk and regulation, and corporate finance. (i) currency and credit: the basis of the financial system 1. The nature and function of the currency. The essence: the currency is a special commodity fixed as a general equivalent, a product of a period of commodity exchange, reflecting the socio-economic relationship between commodity producers. (a) value measures: currency as a measure of the value of a commodity (e. G., a clothing mark-up of 200 yuan, currency performance of value-scale functions, only notional currency); monetary hierarchy (high to low by liquidity): m0: cash in circulation (notes and coins, most liquid); m1 (narrow currency): m0 + corporate demand deposit + institutional group troop deposit + rural deposit + personally held credit card type deposits (directly used for transactions, reflecting economic activity); m2 (broad currency): m1 + savings of urban and rural residents + term deposits of enterprises + trust type deposits + other deposits (covering potential purchasing power, an important reference indicator for monetary policy regulation). 2. Forms and instruments of credit. Definition of credit: borrowing conditional on repayment of principal and payment of interest is the separation of ownership of funds from right of use, with the core being trust relationships. (a) commercial credit: credits provided by enterprises when buying and selling goods (e. G. Deferred payments by enterprises for raw materials, core instruments being commercial drafts); (b) classification: i. Short-term credit instruments (terms of one year): commercial drafts, bank drafts, cheques, treasury bills (one of the short-term types of public debt)
