Economics: Money

Which of the following correctly defines money as a unit of account?

• It determines whether a good has value

• It is determined to be legal by the person in possession of it

• It provides a means for comparing the values of goods and services

• It does not retain its value when saved instead of spent

What is the difference between commodity money and representative money?

• Commodity money consists of objects used as money that contain their own value, but representative money is a specific group of the commodity objects

• Commodity money consists of objects that have value in and of themselves, but representative money makes use of objects because the holder can exchange them for something else of value

• 
  Representative money allows objects to be exchanged for something else, but commodity money has value because the government decreed it is an acceptable means to pay debts

• Representative money consists of objects that have value in and of themselves, but commodity money makes use of objects because the holder can exchange them for something else of value

Anything that is generally accepted in payment for goods and services.

• Money

• Barter

• Rationing

• all of the answers are correct

In the United States, our money is based on trust.  Therefore, our money is commonly referred to as

• 
  commodity money

• 
  representative money

• 
  fiat money

• trusted money

Which of the following is an example of a barter system?

• Instead of paying rent, you clean the house for the owner

• 
  Instead of paying cash for a computer, you use a credit card

• Instead of paying the full amount for a car, you pay 10 percent in cash and pay for the rest in monthly installments.

• 
  Instead of paying for a purchase in Mexico in pesos, you use dollars from the United States

Which of the following is NOT an example of a liquid asset?

• 
  cash

• a checking account

• a debit card

• a savings account

Why is using coins as money easier than using gold bars?

• coins are more durable

• 
  coins are more portable

• coins are more uniform

• coins are more limited in supply

Which of the following statement is true?

• Money is a medium of exchange

• Money is a unit of account

• Money is used as a standard of deferred payment

• all of the answers are correct

In the 1990s, the Russian people lost confidence in the value of the ruble, and many were no longer willing to sell goods and services in exchange for Russian currency.  Which characteristic of money did the Russian currency lack?

• acceptability

• uniformity

• 
  limited supply

• durability

Which of the following statements about the US dollar is true?

• It is backed by gold.

• It is backed by silver.

• It is legal tender.

• It is illiquid.