Font size
WorksheetsEcon: Unit 3
Total questions: 122
Worksheet time: 1hrs 1mins
Twenty-dollar bills travel nicely in a wallet, while a cow would likely require a special vehicle for travel to the store across town. In other words, cow are not:
Uniform
Portable
Durable
Divisible
Drew bought $56 worth of school supplies at a discount store. Drew paid for the goods with two $20 bills, three $5 bills, and a $1 bill. Which function of money did Drew exhibit?
Medium of exchange
Store of value
Unit of account
University
Mrs. Hatcher has a twenty-dollar bill that can be easily exchanged for other denominations, but a cow cannot. In this way, a cow is not _________.
Portable
Divisible
Acceptable
Durable
Shane and Joe were discussing different types of money. Shane mentioned that _____ is money that does not have intrinsic value and does not represent an asset in a vault somewhere.
Representative money
Durable money
Fiat money
Portable money
Last year, Jordan stashed her birthday money in her sock drawer. She is saving for a new computer. Which function of money did Jordan exhibit?
Medium of exchange
Store of value
Unit of account
Universality
Julio and Lily noticed that cows come in all shapes and sizes while 20-dollar bills are the same size and shape and value. In other words, twenty-dollar bills are ___
Durable
Portable
Uniform
Divisible
Donovan has a certificate that can be exchanged for a certain amount of gold. This certificate is an example of _____.
Representative money
Durable money
Fiat money
During a classroom discussion, Daniel asked Peter about fiat money. Peter explained that fiat money:
Exists by government decree
Only has use as a medium of exchange, store of value, and unit of account
Is divisible, recognizable, portable, and acceptable
All of the above
JonnieMae and Daniel are discussing the role of central banks. Daniel asks, "What do central banks sell to ensure the stability of the economy?" JonnieMae replies, "Silly goose! They sell ___!"
government bonds
corporate stocks
real estate properties
consumer goods
During a class discussion on economics, Charles asked Noah about how central banks operate. Noah explained that most central banks in the world today:
Are managed directly by their nation’s elected officials
Have to submit their monetary policy decisions to the fiscal authorities for approval
Are given certain independence from the government
Do not set inflation targets to promote price stability
During a class discussion, Joe asked Shane and Daniel about the greatest risks associated with fiat money. According to Shane and Daniel, what is one of the greatest risks?
Overprinting by government authorities to pay for debts
Its conversion into silver or gold
Its use as collateral for short term financing
The fact that it is virtually costless to produce
Logan S. and RJ are discussing the benefits of different types of money. Logan S. asks RJ, "What do you think is the great benefit of a fiat money?" RJ replies, "Hey bruh, that's easy. A great benefit of fiat money is ___."
Is its ability to be converted into gold or silver
Is its efficiency to serve as a medium of exchange, especially since much of it is electronic money
Is that nations using fiat money avoid inflation
Is its physical form; it is all paper currency and coin
Logan B. and Kevin were discussing farm animals. Logan B. said, "Cows are not very _____________."
Easily divided
Portable
Both A and B are correct.
Neither A nor B are correct.
Jordan and Addison K. are discussing why modern forms of currency are better than salt cubes. Addison mentions that modern currency is typically very uniform. What does this mean?
They are long lasting
They can be easily divided
They have a standard recognizable shape, size, and value
All of these
Addison and Logan are collecting rare coins. They know that if these coins were available in large amounts, they would lose their value. Which characteristic of money does this describe?
Scarcity
Durability
Portability
Uniformity
Why couldn’t JonnieMae buy a bike, a video game, or a chocolate bar with her shells?
People wouldn’t accept them as payment
Her shells were in a bag
Her shells were too small
People already had too many shells
Kevin and Joe are discussing different materials to use as a form of money. Kevin suggests using copper because it is a type of metal and is usually more long-lasting than salt or grain, which can be easily ruined if they get wet. So, copper is better to use as a form of money than salt or grain because of its __________.
Usability
Durability
Portability
Uniformity
In a classroom discussion, Sydnee and Logan talked about how throughout history, people have used many things as money, including beads, cows, dried fish, and copper, to buy goods and services.
True
False
How are Shane's and Addison's bank accounts like the stone at the bottom of the ocean?
The amounts in their bank accounts change without their physically handling dollars.
Neither have any value.
Both are only used for big purchases.
They are not similar at all; the checking account represents real money, while the stone does not
Why did Jade and Logan decide to use limestone as a form of currency on their island?
They had no other materials they could use to make coins
They found it easier to make very large coins if they used limestone
They have abundant amounts of limestone that was easy to mine on the island
They thought because it was pretty, like gold in other places, it would be a good form of money
What was this stone money used for?
Everyday purchases like food
Purchasing more limestone
Just decoration, as it was difficult to move
Infrequent occurrences like a dowry.
After currency is in the Federal Reserve Board’s vault, where does it go next?
The currency stays in the vault for several years
The currency goes to the 12 Federal Reserve Banks
The currency goes back to the Bureau of Engraving and Printing’s vault for more inspiration
The currency goes to commercial banks.
Logan and Shane are curious about where the Fed orders its money from. Can you help them find out?
The Federal Reserve
United States Mint
Government Publishing Office
The Bureau of Engraving and Printing
Athena and Daniel are learning about the banking system. They wonder, when do bank notes officially become lawful money?
When it is printed at the Bureau of Engraving and printing
When the Federal Reserve board receives it from the Bureau of Engraving and Printing
When the Federal Reserve Board issues the notes to the Federal Reserve Banks
When the Federal Reserve Board reviews the notes and puts them in the vault.
Noah and Daniel want to open a bank or credit union account in person. To do so, they need
one form of identification, such as a Social Security card, state-issued driver’s license, passport, or birth certificate.
two forms of identification, such as a Social Security card, state-issued driver’s license, passport, or birth certificate.
one form of identification, such as a Social Security card, state-issued driver’s license, passport, or birth certificate, and a recommendation from someone who already has an account at the bank or credit union.
two forms of identification, such as a Social Security card, state-issued driver’s license, passport, or birth certificate, and an endorsement from someone who already has an account at the bank or credit union.
Julio and Logan each have a bank account. If properly insured, each of their bank accounts is protected up to
$25,000.
$50,000.
$150,000.
$250,000.
Logan and Noah are planning to open a joint bank account. They want to ensure that the bank is a member of the
Office of the Comptroller of the Currency.
Federal Deposit Insurance Corporation.
Consumer Financial Protection Bureau.
Federal Reserve Board.
Shane and Addison are planning to open a joint account at a credit union. They want to ensure that the credit union is a member of the
Office of Thrift Supervision.
Consumer Financial Protection Bureau.
National Credit Union Association.
Federal Securities and Exchange Commission.
Jade and Logan are discussing their banking options. Jade mentions that online-only banks provide online banking services, while traditional banks and credit unions do not.
True
False
Lily and Logan are looking to open a checking account. Which of the following is an important thing for them to consider when choosing a bank or credit union?
Whether your friends have accounts at the same bank or credit union
Whether there are monthly fees or minimum balance requirements
The color scheme used on a bank’s checks
The name of the bank or credit union
Charles and Lily are discussing the benefits of having an account at a bank or credit union. Which of the following is NOT a reason they would consider?
Your money is safe, and money in an account may earn interest.
You have a record of your transactions.
You’ll likely have 24-hour access to your money.
You are guaranteed a loan.
Athena and Noah have opened a joint account at a local credit union. It is important for them to manage their account. This means checking
the balance in the account once in a while.
the deposits made to the account once a week.
that deposits withdrawn from your account and payments made to your account are accurate.
that deposits made to your account and payments made from your account are accurate.
Peter and Luke are managing their joint savings account. It is important for them to make sure deposits and withdrawals are accurate so that they can
avoid paying overdraft fees and make certain records and account balances are accurate.
ensure that you are paying the appropriate amount of taxes on your account.
make sure the bank or credit union is publishing correct information about you on its website.
maintain a strong relationship with your bank.
Kevin and Johanna are discussing their banking options. Kevin says that online banks have physical buildings that you can go to if needed. Is he correct?
True
False
Jordan is learning about bonds in her finance class. Her teacher, Mrs. Hatcher, asks her, "In bond terminology, which of the following terms is the same as 'face value'?"
Mature value
Coupon value
Par value
Cash value
Addison K. and Noah are discussing where to keep their savings. Addison suggests putting the money in a place that is insured by the Federal Deposit Insurance Corporation [F.D.I.C]. Which of the following options should they choose?
Bank checking accounts
Bonds
Stocks
Mutual funds
Julio and Shane are considering investing in bonds. If the yield on other investment alternatives to bonds were to increase, what would likely happen to the price of bonds?
Increase
Decrease
No change
Cannot determine
Jade is considering investing in bonds and decides to buy one that pays interest quarterly. What type of bond does Jade own?
A corporate bond
A government bond
A non-coupon bond
A coupon bond
Logan and Addison are considering different investment options for their savings. Which of the following investment options has the highest potential risk and the highest potential return?
Stocks
Mutual funds
Commodities
Bonds
Jordan and Lily are discussing their investment options. Jordan believes there are investments that are both safer and provide higher returns than bonds.
True
False
Jade and Joe are discussing different types of investment options. Jade mentions Treasury Inflation Protected Securities [T.I.P.S]. Who uses T.I.P.S?
Corporations
Banks
Investment companies
The U.S. Government
Addison and Jordan are considering buying I and E/EE Series Bonds. They learn that they can purchase these bonds for any incremental amount starting at $25.00, including dollars and cents.
True
False
Joe and Donovan are discussing different types of investments. Joseph asks, "Which of the following investments is most like a loan (or an I.O.U.)?"
Stocks
Bonds
Commodity
Mutual funds
Why did Sydnee and Jordan's community rely on an all-cash economy until recently?
Cash is easier to carry.
People do not trust banks and “virtual money.”
Cash makes transactions easier than using credit cards.
There is more money flowing in the economy with cash.
How was the ATM used by Johanna and Luke connected to the financial system?
It was directly routed to a processor in St. Louis, Missouri.
It was routed to major banks in Hong Kong and Singapore.
It was connected via telephone lines to a main server in Naypyidaw, Myanmar.
It uses an Internet connection to financial intuitions in Shanghai, China.
Why did Drew and Lily have a trust issue with banks in Myanmar?
Bankers were stereotyped to be stingy and greedy.
People preferred keeping their money where they can easily find it, like under their bed.
Myanmar has a history of corruption and there have been runs on the banks.
The government made a law in the 1900s banning banks.
How did people start trusting ATMs more?
Requiring everyone to withdraw their salary from an ATM
Seeing friends and family members like Sydnee and Logan have successful experiences
Imposing watchmen to guard the ATMs and ensure that no one steals anything
Strict government regulation to enforce integrity laws
Charles and Jade are comparing financial services. They notice that banks and credit unions typically charge much less for the same financial services that payday and title lenders, pawn shops, and check-cashing centers offer.
True
False
Which type of loan can you easily acquire with just an ID, Social Security card, paycheck stub and bank account number?
Pawn shop loan
Payday loan
Title loan
Which type of loan requires you to trade something valuable you own, like jewelry or tools, for cash?
Pawn shop loan
Payday loan
Title loan
Mortgage loan
Typically, how much does a check cashing place typically charge to cash a check?
.50% of the total check amount
.5% of the total check amount
5.5% of the total check amount
10.5% of the total check amount
How do pre-paid cards differ from using a standard debit card?
A pre-paid card is a cash-free payment option.
A pre-paid card is linked to your checking account.
A pre-paid card often has a number of fees associated with it.
A pre-paid card requires you to have a co-signer.
When a person is young, how is consumption smoothed?
By saving for future expenses
By borrowing against future income
By relying on parental support
By reducing consumption needs
When a person is middle aged, how is consumption smoothed?
By saving more during younger years
By spending less during middle age
By borrowing against future income
By maintaining a stable income
When a person is elderly (retired), how is consumption smoothed?
Through savings accumulated during working years
By relying solely on social security benefits
By increasing work hours
By reducing all expenses to a minimum
What trade-off does saving present? More saving requires less spending on current consumption.
More saving requires more spending on current consumption.
More saving requires less spending on current consumption.
More saving has no effect on current consumption.
More saving increases current consumption.
The benefit of saving is:
Financial security
Increased spending
Higher taxes
More debt
What are the two ways people may make money by investing in stocks? Define each one.
Dividends and Capital Gains
Interest and Rent
Savings and Bonds
Loans and Mortgages
Diversification can help reduce investment risk by:
spreading investments across various assets to minimize potential losses
focusing on a single asset to maximize returns
investing only in high-risk assets for higher gains
avoiding investments altogether
What is the difference between a stock’s price and its value?
A stock's price is its current market price, while its value is the intrinsic worth based on fundamentals.
A stock's price is its intrinsic worth, while its value is the current market price.
There is no difference between a stock's price and its value.
A stock's price is determined by its value.
The efficient market hypothesis (EMH) states that a stock’s current price reflects all relevant information about its current and future earnings.
True
False
Why might passive managers say that the much lower transaction costs for their funds are a key advantage of index funds?
Because they lead to higher returns
Because they reduce the overall cost of investment
Because they increase market volatility
Because they require active management
Mutual fund companies pick the stocks in an index fund by:
Selecting stocks based on market trends
Choosing stocks that match the index composition
Picking stocks randomly
Following the advice of financial analysts
What type of credit usually has a low spending limit that is tied to your bank account to ensure late or missed payments do not go unpaid?
Rent-to-Own
Deferred interest plan
Secured credit card
Store layaway
8. If you’re in the market for a new sofa sectional, an $829 price tag may seem a little daunting. The Rent-to-Own down the street may offer the same sofa for 104 payments of $29.99. The Rent-to-Own price sounds pretty reasonable, but how much will you be paying in the long run?
$1100.50
$2099.90
$2589.99
$3118.96
Which of the following reasons make Rent-to-Own and Buy Here, Pay Here such popular options for consumers?
Accessible only to those with good credit
There are minimal fees
Interest rates low
Accessible to consumers with bad credit
Which of the following transactions should not be included in a budget?
Your paycheck.
Your cell phone bill.
Filling your gas tank weekly.
Your car insurance bill due every six months.
All of the transactions should be included in a budget.
Which of the following cannot be classified as an expense?
Money you donated to charity.
Money you owed your brother and finally paid.
Money you spent going to a movie with your friends.
Money your aunt Martha paid you for mowing and raking the lawn this week.
Which of the following describes a healthy budget?
A healthy budget is one in which income is greater than expenses.
A healthy budget is one in which expenses are greater than income.
A healthy budget is one in which the debits are greater than the credits.
A healthy budget is one in which expenses are high and income does not exist.
Which of the following statements is an effective budgeting behavior?
Balancing your bank accounts.
Spending more than you make.
Failing to keep track of your cash transactions.
Forgetting to include taxes when estimating the amount of your paycheck.
With deferred interest plan, it is important to be sure to pay off the entire balance within the agreed upon time frame to avoid having to pay interest on the entire amount borrowed.
True
False
While Rent-to-Own and Buy Here, Pay Here places allow someone with poor credit and/or very little savings to purchase the things they want, they usually end up costing the consumer a lot more than a traditional loan would. Why?
These places typically change high interest rates.
These places typically charge low interest rates.
Rent-to-Own and Buy Here, Pay Here places can repossess your purchased goods after missing only one payment without refunding any of the money already paid.
True
False
Future is planning for his future and wants to ensure he has enough money saved for retirement. He is considering enrolling in a 401(k)/403(b), which is a type of:
retirement savings plan
health insurance plan
educational savings account
mortgage loan
When GloRilla and her friends decided not to buy snacks from the school cafeteria to protest against the increased prices, they were participating in:
a form of protest involving the refusal to buy or use goods and services
a type of government policy
a method of increasing sales
a form of entertainment
Harry Styles is studying economics and learns that a central bank is:
a commercial bank that offers loans to the public
a financial institution that manages a country's currency, money supply, and interest rates
a bank that provides services to individual customers
a private bank that operates internationally
At a local manufacturing plant, what is collective bargaining?
A process of negotiation between employers and a group of employees aimed at reaching agreements to regulate working conditions.
A legal requirement for all companies to follow government-set wage standards.
A method for individual employees to negotiate their own salaries and benefits.
A strategy used by employers to avoid unionization of their workforce.
The Weeknd is planning to start a small business and needs a place that can accept his deposits and offer him a loan. A commercial bank is:
a financial institution that accepts deposits and offers loans
a type of investment bank
a government agency that regulates the stock market
a non-profit organization
Cher found an old coin collection in her attic. She learned that these coins were considered commodity money because they are:
backed by a physical commodity like gold or silver
issued by the government without backing
used only in digital transactions
based on the trust of the users
Doja Cat and her friends decided to start a business together where they all have equal say and share the profits. This type of business is a:
business owned and operated by a single individual
business owned and operated by a group of individuals for their mutual benefit
government-owned corporation
non-profit organization
Justin Bieber, a.k.a. The Biebs, is considering where to open a savings account. He learns about a credit union, which is a type of:
bank
non-profit financial institution
insurance company
investment firm
Logan and Logan are setting up a lemonade stand that they're calling "Logan and Logan." They decide to use a system of ______ as a medium of exchange for their lemonade.
coins and banknotes
digital assets
commodities
services
When Dr. Dre sets up his new smartphone, he notices that the ringtone is already set to a specific tune. What is this preselected option called?
A preselected option adopted by a computer program or other mechanism when no alternative is specified by the user or programmer.
A type of error in a program.
A user-defined setting in a program.
A programming language.
Billie Eilish wants to open a bank account where she can withdraw funds at any time without any notice. What type of account should she open?
A type of bank account from which funds can be withdrawn at any time without any notice.
A fixed-term investment account.
A loan provided by the bank.
A type of deposit that requires a notice period before withdrawal.
Olivia Rodrigo recently opened a savings account at her local bank and was curious about how her money is protected. She learned that the Federal Deposit Insurance Corporation (FDIC) is:
a government agency that insures bank deposits
a private corporation that provides loans
an international organization that regulates trade
a non-profit organization that supports education
Cardi B. is studying about different financial institutions in her economics class. She comes across a question: What is the Federal Reserve System/Bank?
A central banking system of the United States
A private bank for wealthy individuals
A financial advisory firm
A global investment bank
Bad Bunny and Selena Gomez are discussing different types of currencies. Bad Bunny asks, "What is fiat money?"
A type of currency that is backed by a physical commodity like gold or silver.
A type of currency that has value because a government maintains it and people have faith in its value.
A type of digital currency that uses cryptography for security.
A type of currency used exclusively in international trade.
Chris Stapleton is looking to buy a house and needs a loan. He approaches a financial intermediary. A financial intermediary is a:
bank or institution that facilitates the channeling of funds between lenders and borrowers
type of currency used in international trade
government agency that regulates financial markets
method of calculating interest rates
Eminem is learning about financial systems in his economics class. He discovers that a financial system is:
a network of institutions that facilitate the exchange of funds
a type of government policy
a method of accounting
a form of currency
Kendrick Lamar, SZA, and Mrs. Hatcher decide to open a bakery together as a general partnership. In this business arrangement:
All partners have limited liability.
At least one partner has unlimited liability.
All partners share equal responsibility and liability.
Partners are not involved in management.
Lady Gaga is conducting a survey to understand the employment status in her community. She wants to know who is part of the labor force. The labor force is:
all the people who are employed or actively looking for work
only the people who are currently employed
only the people who are unemployed
all the people who are not working
Drake and his colleagues at the factory decided to form a labor union. A labor union is a:
group of workers who join together to negotiate with employers
type of government organization
company that hires workers
law that protects workers' rights
Tate McRae and Sabrina Carpenter are starting a new business. They choose a business structure where they are not personally liable for the company's debts. What is this type of business structure called?
A type of business structure where owners are not personally liable for the company's debts
A situation where owners are fully responsible for all business debts
A financial term describing unlimited profit potential
A legal term for complete ownership of a company
Eminem and Rihanna are starting a business together. They decide to form a limited partnership. A limited partnership is:
a type of partnership where some owners have limited liability
a partnership where all partners have equal responsibility
a partnership that is not legally recognized
a partnership with unlimited liability for all partners
Charli xcx is considering selling her car to get some quick cash. Liquidity refers to the ease with which an asset, like Charli xcx's car, can be converted into cash without affecting its market price.
The ability to convert an asset into cash quickly
The process of buying and selling assets
The measure of an asset's profitability
The rate at which an asset appreciates
Lily is at a local market and wants to buy some fresh fruits. She uses the medium of exchange to pay the vendor. The medium of exchange is:
a form of currency used to facilitate transactions
a type of communication medium
a method of transportation
a style of art
What is one of the main reasons modern currency is preferred over bartering with goods like livestock?
Modern currency is more durable
Modern currency is more portable
Modern currency is more divisible
All of the above
During a discussion on investments, Lily asks Jordan, "Which type of investment typically offers ownership in a company?"
Commodities
Stocks
Bonds
Real estate
In a conversation about financial institutions, Shane asks Joe, "What is a key advantage of using a credit union over a payday lender?"
Higher interest rates on loans
More flexible loan terms
Lower fees for financial services
Faster service
Eminem and Dr. Dre are discussing the characteristics of good money. Eminem argues that a key feature of good money is its ability to be easily transported from one place to another. This characteristic is known as __________.
Durability
Portability
Divisibility
Uniformity
Kendrick Lamar and Drake have a new beef and are debating the advantages of using digital currency. Kendrick states that one major advantage is the ability to make transactions without physical exchange. This advantage is primarily due to its __________.
Security
Efficiency
Portability
Accessibility
Lady Gaga and Bruno Mars are discussing the role of central banks in the economy. Gaga asks, "What is one of the primary functions of a central bank?" Bruno responds, "A central bank primarily __________."
Sets tax rates
Issues corporate bonds
Regulates the stock market
Controls the nation's money supply
Which of the following is a retirement savings plan available to private sector employees?
401(k)
403(b)
Credit Union
Federal Reserve System
A central bank is responsible for managing all of the following EXCEPT:
Currency
Money supply
Interest rates
Corporate loans
What is the primary function of collective bargaining?
To negotiate wages and benefits for employees
To ensure the proper distribution of wealth within a country
To set national interest rates for the central bank
To prevent unions from forming
