Currency

Which of the following describes a barter system?

• A market where money is exchanged

• A market with only credit cards

• When you take out a loan

• A market where goods and products are exchanged between sellers

What is the primary problem with a barter economy?

• You need to find someone with a product you want and you need to have a product they want at the same time.

• Credit is hard to develop

• There are no problems with a barter economy.

Which of the following is NOT a function of money?

• Medium of Exchange

• Unit of Account

• Store of Value

• Dependability

Which of the following is NOT considered to be in the money supply?

• Checking accounts

• Paper money/Coins

• Travelers Checks

• Credit card transactions

Why are credit cards not considered money?

• Because they are made out of plastic

• Because you are making a PROMISE to pay something, but haven't actually paid it

• Because they charge interest

What are interest rates?

• How cool people think the banks are

• When you open a checking account

• Extra money you pay on a loan

• None of the above

Why does paper money make good currency?

• It is easily transportable, maintains value, and is easy to divide

• It is green

• You can use it to buy groceries

What is a savings account?

• Money that you can use with your debit card

• Money in international accounts

• Money from different countries

• Money in an account that gains interest and can be withdrawn quickly