Topic 6.1 and 6.2

Which of the following is true about bartering?

• it is usually fast and concenient

• it is often used in urban areas of the United States

• it involves the exchange of currency

• it involves the exchange of goods or services

The fact that you can pay for a five-dollar item with a ten-dollar bill and get five dollars back in change shows which of the following?

• that money is durable

• that money is a store of value

• that money is uniform

• that money is divisible

Why does fiat money have value?

• because it is backed by a government in which people have confidence

• because it is always more portable and divisible than commodity money

• because it has all of the characteristics of representative money

• because it is the only form of currency that meets the six characteristics of money

The fact that every five-dollar bill buys five dollars worth of goods is an example of money’s _________.

• durability

• uniformity

• portability

• divisibility

Which of these is NOT one of the three uses of money?

• a medium of exchange

• a store of value

• a means to barter

• a unit of account

Which of the following is a negative aspect of bartering rather than using currency?

• Bartering requires you to find someone who wants what you have

• Bartering does not require you to have any cash.

• Bartering usually takes less time than using currency.

• Bartering makes it easy to determine the relative value of items.

The fact that coins can last a long time in circulation shows which characteristic of money?

• portability

• durability

• divisibility

• uniformity

Which of the following is an example of money's divisibility?

• Coins and bills can last a long time in circulation.

• Twenty dollar bills are easy to carry around in a wallet or pocket.

• A ten dollar bill can purchase a five dollar item, with five dollars change coming back.

• If Jane and Ranita both have a ten dollar bill they can purchase the same $10 t-shirt.

Which of the following is an example of commodity money put to use?

• A cow used to purchase land

• Mowing a lawn for a friend who, in turn, gives you a haircut

• Giving a store clerk a five dollar bill for a $4 purchase

• Writing an I.O.U. to a friend in exchange for a loan

Which of the following did Alexander Hamilton and the Federalists support?

• an economy based on agriculture

• state-regulated banks

• a national bank

• a decentralized banking system