Grade 10 Business Studies Business and Money Management – Money (10 Lessons) Notes

Lesson 1 — What is Money?

Objective: Define money and name common forms used in Kenya (cash, coins, bank deposits, mobile money).

Notes: Money is anything commonly accepted as payment for goods and services or repayment of debt. In Kenya common forms include:

• Cash — Kenyan shillings (notes and coins)
• Bank deposits — money in savings and current accounts
• Electronic/mobile money — e.g., M-Pesa, bank mobile wallets
• Near-money — short-term savings, fixed deposits (less liquid)

Activity: In pairs, list all the ways you personally use money in one day. Share examples with the class.

Lesson 2 — Money in Daily Life (Outcome f)

Objective: Explain how money affects household life, schooling and small businesses.

Examples: Paying for food, transport (matatus, boda-boda), school fees, saving for emergencies, buying supplies for a small business, mobile payments for utilities. Money helps plan and meet immediate and future needs.

Class activity: Prepare a one-week budget of small weekly expenses (Ksh) — transport, food, airtime, saving.

Lesson 3 — Functions of Money (Outcome b)

Objective: Describe the main functions of money with Kenyan examples.

• Medium of exchange: Money is accepted in exchange for goods/services (buying ugali, paying for taxi).
• Unit of account: Prices are expressed in shillings — easy to compare costs.
• Store of value: Money can be saved (bank account or mobile money) and used later.
• Standard of deferred payment: Money is used to settle debts later (installment payments).

Activity: Give three examples where each function is used in your daily life.

Lesson 4 — Key Security Features of Kenyan Currency (Outcome a)

Objective: Identify and check the security features of banknotes and coins to avoid counterfeit money.

Common security features to check:

• Watermark: A faint image visible when a note is held up to light (shows a portrait or national symbol).
• Security thread: An embedded strip running through the note; visible when held to light.
• Raised (intaglio) print: Some parts of the note feel rough (touch with fingertips).
• Holographic patches or shiny foil: Reflective areas that change when tilted.
• Microprinting and fine lines: Tiny text or lines that blur when copied.
• Serial numbers: Unique numbers that match the format and do not repeat.
• Colour-shifting ink or see-through elements: Parts of the note change colour when tilted or align perfectly when back-to-back.

Class activity: Using real Kenyan notes (teacher guided), have learners inspect and list the security features they can find. If no notes available, use images from the Central Bank of Kenya website in class.

Lesson 5 — Demand for Money: Motives (Outcome c)

Objective: Explain why people, firms and the government demand money.

Main motives for holding money:

• Transaction motive: To pay for everyday purchases and business transactions.
• Precautionary motive: To meet unexpected expenses (medical bills, emergencies).
• Speculative motive: Holding money to take advantage of future investment opportunities or when interest rates/asset prices are uncertain.

Link to development: Adequate demand for money helps the economy function — smooth trading, predictable investments and saving for growth projects (schools, roads, businesses).

Activity: Provide real-life scenarios and ask learners to identify the motive for holding money (e.g., parent saving for school fees — precautionary/transaction).

Lesson 6 — Why Demand for Money Helps Economic Development (Outcome c)

Objective: Justify how demand for money supports growth and development.

• Facilitates trade: More transactions mean more goods and services exchanged, supporting businesses and employment.
• Encourages saving and investment: People hold balances to invest in businesses, education and housing.
• Supports efficient price signals: Money lets buyers and sellers compare prices and make better decisions.
• Enables government financing and public services: Taxation and borrowing in money allows the government to fund development projects.

Class exercise: Debate: "Increased money in circulation always leads to development." (Split class pro/con.)

Lesson 7 — Supply of Money: Who Controls It? (Outcome d)

Objective: Identify main institutions that determine the supply of money in Kenya.

Main controllers:

• Central Bank of Kenya (CBK): Issues currency, sets reserve requirements, conducts open market operations and uses monetary policy to influence money supply.
• Commercial banks: Create money through lending (deposit multiplier effect).
• Non-bank financial institutions and mobile money providers: Contribute to the effective money available for transactions.
• Government fiscal actions: Borrowing and spending affect liquidity in the economy.

Activity: Map on paper how a bank loan creates more deposit money (simple money multiplier illustration).

Lesson 8 — Factors that Determine Money Supply (Outcome d)

Objective: Examine and explain factors that increase or decrease the money supply.

• Central bank policy: Changes in reserve ratios, discount rate, open market operations (buying/selling government securities).
• Commercial bank behavior: Lending policies, willingness to lend, required reserves.
• Public preference for cash vs. deposits: If many prefer cash outside banks, money multiplier falls.
• Foreign exchange flows: Large inflows (exports, remittances) can increase domestic money supply.
• Technology and mobile money: Widespread use of M-Pesa and electronic wallets change how quickly money circulates.
• Government fiscal operations: Large budget deficits financed by the central bank can increase money supply.

Class problem: If CBK raises reserve requirements, what happens to commercial bank lending? Explain impact on money supply and businesses.

Lesson 9 — Ethical Use of Money and Responsible Transactions (Outcome e)

Objective: Identify ethical and unethical practices in money transactions and suggest responsible alternatives.

Examples of ethical practices:

• Transparency — giving correct change, issuing receipts, honest pricing.
• Fair dealing — no price gouging, respect for contracts and agreements.
• Responsible borrowing — only borrow what you can repay, full disclosure.
• Combating corruption and bribery — report and refuse corrupt requests.
• Preventing money laundering — know-your-customer rules for businesses, avoiding suspicious transactions.
• Paying taxes and school fees honestly — supporting public services.

Class activity: Role-play: seller gives wrong change — discuss ethical behaviour and correct steps.

Lesson 10 — Revision, Assessment and Real-life Application (All Outcomes)

Objective: Review key ideas and apply them to local scenarios.

Suggested activities:

1. Short group quiz: identify security features from pictures, name functions of money, list factors affecting supply.
2. Case study: A small shop in Nairobi uses both cash and M-Pesa. Explain why customers and the owner choose each method, and what ethical issues might arise (receipts, tax).
3. Project: Each group prepares a poster on "How to spot counterfeit notes" and "Responsible use of money". Display in class.

Assessment ideas: short written test (definitions and short answers), practical inspection task (identify features on notes), group presentations.