Money and the Fed

Which of the following is an example of a barter system?

• Instead of paying rent, you clean the owners house
• instead of paying cash for a computer, you use a credit card
• Instead of using pesos in Mexico, you use dollars

Which is an example of money as a unit of account?

• buying a toy for $8.99
• lending a friend $25
• checking the price of a camera at several stores before buying it at the lowest price

money being able to withstand wear and tear from use is an example of its 

• unifromity
• portability 
• divisibility
• durability

Objects that have value in themselves as well as their value as a means of exchange are called 

• simple money 
• commodity money
• representative money

What is the purpose of the 
Federal Deposit Insurance Corporation (F.D.I.C.)

• to make sure banks do not fail
• to make sure customers don't lose money if a bank fails
• to make sure the banks charge a fair amount of interest on loans

What is the gold standard?

• a currency system in which each dollar is worth 1/20 of a pound of gold
• a system that uses gold coins as a country's money
• a sysytem in which a country's money is backed with gold

Which of the following is not a responsibility of the Federal Reserve?

• supervising commercial banks 
• overseeing taxation a government spending 
• conducting monetary policy
• providing financial services to member banks 

What is a mortgage used to purchase?

• real estate
• car
• college tuition
• business expenses

Why is using coins as money easier than using gold bars?

• coins are more limited in supply
• coins are more unifrom
• coins are more portable
• coins are more durable

Who are the direct owners of the Federal Reserve?

• privately owned by the government 
• publicly owned its Board of Governors
• publicly owned by private investors
• privately owned by its member banks