Finance-Money Chapter 1

Which of the following assets has the highest liquidity?

• a. Raw materials and materials in stock

  
  

• b. Securities

  
  

• c. Accounts receivable

  
  

• d. Foreign currency deposited in a bank

  
  

1. Liquidity of an asset is:

• a. The ease with which the asset can be converted into cash

  
  

• b. The ability of the asset to generate income

  
  

• c. The ease with which the asset can be converted into common stock

  
  

• d. The amount of money the asset can be sold

  
  

1. Arrange the order of the birth of money:1. Checks, 2. CBDC, 3. Commodity money, 4. Fiat Money, 5. e-Money : 

• a. 3 - 1 - 2 - 5 - 4       

  
  

• b. 3 - 4 - 1 - 5 – 2  

  
  

• c. 3 - 5 - 1 - 2 – 4 

  
  

• d. 3 - 2 - 1 - 5 - 4 

  
  

1.  In which of the following transactions does money perform the function of exchange?

• a. Transfer money via bank account

  
  

• b. Buy at the supermarket

  
  

• c. Withdraw money from ATMs

  
  

• d. All 3 answers above

  
  

1. In the functions of money

• a. The function of a medium of exchange reflects the nature of money

  
  

• b. The function of storing value is a function only found in currency

  
  

• c. The world currency function is the most important function

  
  

• d. Both a and b

  
  

1. When performing which of the following functions, money does NOT need to be physically present:

• a. Medium of exchange 

  
  

• b. Unit of account

  
  

• c. Store of Value

  
  

1. When businesses pay for purchases, currency has functioned

• a. Medium of exchange

  
  

• b. Unit of account

  
  

• c. Store of Value

  
  

1. In essence, financial relations are

• a. The process of consuming goods

  
  

• b. The process of transferring capital sources

  
  

• c. Production process

  
  

• d. Buying and selling process

1. Which of the following relationships is a financial relationship?

• a. Browning-Lending

  
  

• b. Taxpayer

  
  

• c. Carriage

  
  

• d. a and b

  
  

1. The state participates in the financial distribution process in which of the following capacities?

• a. Being a first-time distribution participant

• b. Be a participant in redistribution

  
  

• c. Both a and b