Economics Unit 4 Public Policy and the Economy Assessment

Which of the following accurately completes the graphic

• Federal Reserve notes

• types of money

• characteristics of money

• functions of money

Commodity money can best be described as--

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

• currency that a government has declared to be legal tender, despite the fact that it has no intrinsic value and is not backed by Reserves

• a form of money which has an intrinsic value, meaning it is worth something in its own right such as corn or oil, rather than simply being a token of financial value

• money that consists of a token or certificate they can be exchanged by a specific good, such as gold, silver, or potentially water, OIL, or food

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

• conducted without consumer protections

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

• build a strong credit score

• repay credit card debts faster

• access currency without carrying cash

• purchase Goods without having any money

The Federal Reserve System designed in the manner described above resulted in the creation of--

• Reserve Bank satellite locations

• a decentralized system of banks

• new methods for printing money

• one large depository for US currency

Which of the following best completes the graphic?

• Stock Exchange

• Federal Reserve System

• Treasury Department

• Washington DC

One Way the Federal Reserve can counter unemployment and stimulate spending is by--

• selling securities

• decreasing the discount rate

• tightening monetary policies

• increasing the reserve requirement

In order to require Banks to hold more money as opposed to lending it, the Federal Reserve can--

• decrease the discount rate

• decrease the federal funds rate

• increase the reserve requirement

• to spend the federal funds rate target

Which of the following is an action of the Federal Reserve that strongly influences local economies?

• it can raise or lower property taxes

• it can provide stimulus money for job creation

• it can require Banks to provide savings accounts to the community

• you can make loans cheaper or more expensive by adjusting interest rates