Understanding Money and Financial Systems

What is one of the primary functions of money?

• To serve as a medium of exchange

• To be a form of entertainment

• To act as a decorative item

• To be a source of energy

What is a disadvantage of the barter system?

• It simplifies trade

• It is efficient for large economies

• It requires a double coincidence of wants

• It allows easy future contracts

Which of the following is NOT a property of money?

• Durability

• Portability

• Divisibility

• Invisibility

What is fiat money?

• Money made of precious metals

• Legal tender backed by government decree

• Currency used only in digital form

• Money backed by a physical commodity

What is a characteristic of Bitcoin?

• It is issued by a central bank

• It is a peer-to-peer digital currency

• It is backed by gold

• It is a physical currency

What is a major advantage of using Bitcoin?

• High transaction costs

• Government backing

• Increased privacy

• Guaranteed value stability

What is a common issue with digital currencies like Bitcoin?

• They are backed by physical assets

• They have severe price volatility

• They are immune to cyberattacks

• They are universally accepted

What is mobile commerce?

• A form of traditional currency

• A type of barter system

• A retail outlet in a physical store

• Electronic commerce via wireless technology

What is a feature of Apple Pay?

• It uses a magnetic stripe for transactions

• It requires physical cash

• It is only available on Android devices

• It uses near field communication (NFC)

What is a key benefit of mobile payment systems?

• They are only for large purchases

• They are limited to local transactions

• They require physical presence

• They offer convenience and speed