1 Money is anything that serves as a medium of exchange for goods and services True Answer Correct can be converted into silver with relatively little loss in value Incorrect can be converted into gold with relatively little loss in value Incorrect is traded in the stock market Incorrect Money is paper money and coins but not checks Incorrect currency and stocks Incorrect anything that can easily be used to buy goods and services True Answer Correct not represented by any of the above Incorrect An economy that lacks a medium of exchange must use a n anarchist system Incorrect barter system True Answer Correct communist system Incorrect expanding system Incorrect Which of the following assets is the MOST liquid a 50 bill True Answer Correct a 50 Amazon com gift certificate Incorrect 100 shares of Microsoft stock Incorrect an economics textbook Incorrect Which of the following combination of assets is considered to be money currency in circulation checkable bank deposits and credit cards Incorrect currency in circulation checkable bank deposits and travelers checks True Answer Correct currency in circulation and in bank vaults checkable bank deposits and travelers checks Incorrect 2 3 4 5 6 8 7 9 10 currency in circulation and in bank vaults checkable bank deposits and credit cards Incorrect Which of the following would NOT fit the economist s definition of money currency Incorrect checkable bank deposits Incorrect coins Incorrect bonds True Answer Correct Which of the following assets is the MOST liquid checkable bank deposits Incorrect currency True Answer Correct stocks Incorrect money market mutual funds Incorrect Which of the following is an asset that most people would consider money your house Incorrect your shares of stock in a company Incorrect your checking account balance True Answer Correct your car Incorrect Money is any asset the government says is money Incorrect any asset that can easily be used to purchase goods and services True Answer Correct any asset that has a positive value Incorrect any asset the government says is money and that has a positive value Incorrect Which of the following assets is an example of money a 20 bill in your pocket True Answer Correct a valuable work of art Incorrect a baseball signed by a famous player Incorrect shares of stock in a profitable company Incorrect 11 12 14 15 Which of the following is considered to be money Google stock Incorrect bonds Incorrect credit cards Incorrect checking account deposits True Answer Correct The double coincidence of wants problem can be solved by more resources Incorrect more production Incorrect money True Answer Correct economic growth Incorrect 13 An example of a double coincidence of wants is a car mechanic who wants a TV finding an owner of an electronics store who wants a car repaired True Answer Correct a car dealer who wants a TV finding an electronics store owner who wants money Incorrect an electronics store owner who wants car repairs finding a car mechanic who wants money Incorrect a car dealer who wants a new employee finding a car mechanic who wants money Incorrect The narrowest definition of money excludes currency in the vault at the bank True Answer Correct traveler s checks Incorrect currency in circulation Incorrect checkable bank deposits Incorrect All of the following are roles of money EXCEPT a measure of wealth True Answer Correct a medium of exchange Incorrect a unit of account Incorrect a store of value Incorrect 16 17 18 19 20 21 When you are using money to purchase a new MP3 player money is serving as a store of value Incorrect medium of exchange True Answer Correct unit of account Incorrect double coincidence of wants Incorrect Suppose a group of people decided to create their own economic system with cartons of milk serving as money If we decided to use this liquid asset as our medium of exchange and all prices were measured in cartons of milk milk would still not be a good form of money because it would not be a good medium of exchange Incorrect unit of account Incorrect store of value True Answer Correct near money Incorrect Tuition at State University this year is 8 000 Which function of money does this statement best illustrate as a store of value Incorrect as a medium of exchange Incorrect as a unit of account True Answer Correct as a means of deferred payment Incorrect Which of the following is NOT considered one of the three chief characteristics of money It serves as a medium of exchange Incorrect It acts as a store of value Incorrect It is a highly illiquid asset True Answer Correct It is a unit of account Incorrect When we use money to buy groceries money is playing the role of a medium of exchange True Answer Correct reserve of wealth Incorrect unit of account Incorrect store of value Incorrect The medium of exchange function means that money is used 23 The functions of money are as the common denominator of prices Incorrect as the common denominator of future payments Incorrect to pay for goods and services True Answer Correct to accumulate purchasing power Incorrect Buying a ticket to a football game with a 20 bill means money is functioning as a medium of exchange True Answer Correct store of value Incorrect unit of account Incorrect standard of deferred payment Incorrect expander of economic activity medium of exchange and store of value Incorrect medium of exchange store of value and factor of production Incorrect store of value medium of exchange and determinant of investment Incorrect store of value unit of account and medium of exchange True Answer Correct When a person makes price comparisons among products money is being used as a n unit of account True Answer Correct expander of economic activity Incorrect medium of exchange Incorrect checkable deposit Incorrect When you buy a ticket to the rodeo you are using money as a n expander of economic activity Incorrect store of value Incorrect factor of production Incorrect medium of exchange True Answer Correct When you discover money in your coat that you placed there last winter you unexpectedly find you were using money as a n medium of exchange Incorrect 22 24 25 26 27 29 30 31 expander of economic activity Incorrect factor of production Incorrect store of value True Answer Correct When we keep part of our wealth in a savings account money is playing the role of medium of exchange Incorrect unit of account Incorrect barter Incorrect store of value True Answer Correct 28 When we put a price on a meal
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