Money, Banking, and Federal Reserve Assessment Two

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You receive money as payment for working at a grocery store. This best illustrates which function of money?

• medium of exchange
• unit of account
• store of value
• liquidity
• commodity money

Marcella puts money into her savings account. Which function of money does this illustrate?

• store of value
• medium of exchange
• unit of account
• fiat money
• commodity money

A liquid asset is one where the asset is easily

• converted to the medium of exchange.
• exchanged because of the intrinsic value of commodity money.
• transported to the bank.
• circulated throughout the economy in a given year.

The agency responsible for regulating the money supply in the United States is

• the Comptroller of the Currency.
• the U.S. Treasury.
• the Federal Reserve.
• the U.S. Bank.
• the Secretary of the Treasury.

The Federal Reserve has a total of ________ districts.

• 10
• 11
• 12
• 13

All of the following are true about the Federal Reserve EXCEPT

• the Federal Reserve is overseen by a seven member Board of Governors
• the Federal Reserve is headquartered in New York City
• the Board of Governors are appointed by the President of the U.S.
• the Fed committee is referred to as the Federal Open Market Committee

Decisions by Federal Reserve policymakers concerning the money supply constitute

• monetary policy.
• fiscal policy.
• decrease the unemployment rate.
• operations policy.
• cyclical policy.

Paper money has no intrinsic value; its value comes from the government’s order that we accept it as a form of payment.

• curved money
• fiat money
• commodity money
• federal money