What is Money?

What is a medium of exchange?

• A service offered at no cost

• Anything used to determine value during the exchange of goods and services

• A barter system where no money is used

• A currency used only in digital transactions

What does the term "Barter" refer to?

• The use of money to purchase goods or services

• The direct exchange of one set of goods or services for another

• A formal written agreement for the exchange of goods

• The process of buying goods online

What is a "Unit of Account"?

• A method to ensure fair trade practices

• A means for comparing the values of goods and services

• A system for tracking financial transactions

• A type of currency used in international trade

What is a store of value?

• Something that loses value when stored

• Something that keeps its value if it is stored rather than used

• A place where valuable items are sold

• A type of currency that cannot be exchanged

What is commodity money?

• Paper currency issued by the government

• Digital currency used for online transactions

• Objects that have value in themselves and can also be used as money

• Promissory notes issued by banks

What is representative money?

• Money that is backed by a physical commodity

• Currency that has no intrinsic value and cannot be redeemed

• Objects that are valuable in themselves

• Digital currency used in online transactions

What is Fiat Money?

• Money backed by a physical commodity like gold or silver

• Money that has value because the government has ordered it as an acceptable means to pay debts

• A digital currency that operates independently of a central bank

• An ancient form of currency used in medieval times

Which of the following is NOT a characteristic of money?

• Durability

• Portability

• Colorfulness

• Limited Supply

What characteristic of money refers to it being widely accepted in transactions?

• Durability

• Divisibility

• Portability

• Acceptability

Which characteristic of money ensures that it can be broken down into smaller units?

• Uniformity

• Divisibility

• Limited Supply

• Durability