ITB: Chapter 8-2 Functions of Money

What is the barter system?

• A system where money is used as a medium of exchange

• A system where goods and services are exchanged directly for money

• A system where money is used as a unit of measure

• A system where goods and services are exchanged directly for other goods and services

What is money primarily used as?

• An incentive

• A medium of exchange

• A store of value

• A unit of measure

What is the purpose of a medium of exchange?

• To determine the relative value of different goods and services

• To facilitate the purchase of goods and services

• To communicate the value of a product or service

• To represent a standard and agreed upon value

What is the characteristic of money that allows it to be saved and retain its value?

• Medium of exchange

• Value

• Unit of measure

• Store of value

What is the incentive to work for money?

• The ability to purchase goods and services

• The ability to determine the relative value of different goods and services

• The ability to save and retain value

• The ability to represent a standard and agreed upon value

What is the value of money determined by?

• The unit of measure

• The market demand

• The participants in the economy

• The government