Money

which one is money ?

• cash
• cheque
• draft
• all the above

Barter system is now replaced by

• Banking system
• International system
• Monetary system
• Financial system

The difference between representative money and fiat money is that

• representative money is worth more than fiat money.

• fiat money is counted in coins; representative money is counted in paper dollars.

• fiat money is more durable than representative money.

• representative money is backed by silver or gold, ; fiat money is not.

What effect does inflation have on the purchasing power of money?

• Causes it to go down

• Causes it to go up

• None

• The effect varies depending on the time and place.

During times of hyperinflation

• people often adopt something other than the official currency to use as money

• people hoard the official currency

• the purchasing power of the currency increases rapidly

• the money supply is decreasing

Which of the following is not a characteristic of money?

• Divisibility

• Portability

• Acceptability

• Responsibility

The ability to use an asset as a medium of exchange describes its....

• portability

• scarcity

• durability

• liquidity

What is the Federal Reserve?

• Agency responsible for international trade
• Central credit union
• Agency responsible for collecting taxes
• Central bank of the U.S.

Which of the following is NOT one of the characteristics of money?

• durable
• stable
• scarce
• affordable

Currently, what is U.S. money backed by?

• Frankincense
• Gold
• Silver
• Trust that it is worth something