(Legacy) - Money
24 questions· page 1 of 3
Which function of money overcomes the double coincidence of wants problem that exists in a barter system?
Options
A medium of exchange
B standard of deferred payment
C store of value
D unit of account
What is not a function of money?
Options
A It is a medium of exchange.
B It is a store of value.
C It is a unit of account.
D It is a measure of satisfaction.
Four students have to complete a table showing the functions of money.
Which student is correct?
Options
| medium of exchange | store of value | unit of account | |
|---|---|---|---|
| A | ✓ | ✓ | ✓ |
| B | ✓ | ✓ | x |
| C | x | ✓ | ✓ |
| D | ✓ | x | ✓ |
Which statement about money is correct?
Options
A Deflation reduces the internal purchasing power of money.
B Most financial assets are more liquid than physical assets.
C When money acts as a medium of exchange, it requires a double coincidence of wants.
D When money acts as a store of value, it must be unlimited in supply.
What would make online payment methods less acceptable as a medium of exchange?
Options
A a fee charged for use of the online payment service
B both high and low priced goods can be paid for using the online service
C payments can be made at any time of day and night
D the online payment service can be accessed through a smartphone
What is a function of money?
Options
A to act as a medium of exchange
B to be divisible into small units
C to enable bartering to take place
D to maintain its value when inflation is high
During a period of deflation an economy’s aggregate monetary demand falls.
Which function of money explains this fall?
Options
A a measure of value
B a medium of exchange
C a standard for deferred payment
D a store of value
If the rate of inflation rises from 2% to 20%, which function of money is likely to be most affected?
Options
A medium of exchange
B standard for deferred payment
C store of value
D unit of account
The British pound is the national currency of the UK. In Brixton in south London it is possible to get a distinctively marked currency called the Brixton pound from special cash machines. This can be spent with 150 local shopkeepers. Similar schemes are found in towns in the US, Italy and France.
Should Brixton pounds be considered money?
Options
A no, because it is not possible to have two currencies in a country
B no, because they are not generally acceptable outside of Brixton
C yes, because some shopkeepers are willing to accept them
D yes, because they fulfil all the functions of money
What is a function of money?
Options
A divisibility
B durability
C portability
D medium of exchange