Econ 4Q1W Money Function

Medium of exchange, store of value, and measure of value are all…

• Characteristics of money

• Functions of money

• Types of money

• Measures of money

The definition of Commodity Money can best be described as…

• Paper money distributed by the U.S. government

• Object that has intrinsic value in itself that also serves as money

• Money in the form of cash and coin

• Printed money from State banks

1. In bartering economies, people trade what they __________ for what they ___________.

• Own; buy

• Buy; sell

• Want; need

• Have; need

Money that has value simply because the government says it does is called--

• Credit

• Currency

• Fiat money

• Representative money

One of the disadvantages of operating a barter system is that trading is

• taking place without currency.

• carried out in very large markets.

• limited by availability and demand of goods traded.

• conducted without consumer protections.

Commodity money can best be described as

• trade goods or services between two people without the exchange of money.

• a form of money which has an intrinsic value because it is precious like gold and silver.

• currency that a government has declared to be legal tender, despite the fact that it has no intrinsic value.

• money that consists of goods traded like food and cars.

One advantage to using a debit card is that it allows the user to

• build a strong credit score

• repay credit card debts faster

• purchase goods without having any money

• access currency without carrying cash

Which of the following is NOT an example of Fiat money?

• U.S. government announces it will now accept bottle caps as currency

• Cavemen trade stone tools for cows

• Dollar bills and coins we currently use

• Early state bank dollar bills

Specie is coin minted from gold and silver.

• True

• False

For currency to be used effectively, it is best if it portable, durable, and ________________.

• Used as a store of value

• Backed by gold or silver

• Used as commodity money

• Acceptable in exchange for goods and services