Understanding Money Basics

What are the different types of money?

• Barter System

• Commodity Money, Fiat Money, Representative Money, Digital Currency, Local Currencies

• Gold Standard

• Credit Cards

What is one function of money?

• Store of value

• Unit of account

• Means of production

• Medium of exchange

Can you name a historical form of money?

• Gold coins

• Cowry shells

• Paper currency

• Digital currency

What is a good way to save money?

• Spend all your money on luxury items.

• Ignore your expenses and hope for the best.

• Invest in high-risk stocks without research.

• Create a budget and prioritize saving.

What does currency exchange mean?

• Currency exchange is the process of saving money.

• Currency exchange refers to the act of investing in stocks.

• Currency exchange is the method of printing new money.

• Currency exchange is the process of converting one currency into another.

What is the role of coins in our economy?

• Coins are obsolete and have no role in modern economies.

• Coins play a crucial role as a medium of exchange, store of value, and unit of account in the economy.

• Coins are only valuable in specific countries.

• Coins are primarily used for decorative purposes.

How has money changed over time?

• Money is only used for buying and selling goods.

• Money has always been in the form of gold and silver.

• Money has changed from barter to commodity money, fiat currency, and now digital currencies.

• Money has never changed and remains the same.

Why is it important to save money?

• It is important to save money for financial security, emergencies, and achieving financial goals.

• To avoid paying taxes

• To spend more on luxury items

• To impress others with wealth

What is the difference between cash and digital money?

• Cash is always more valuable than digital money.

• Digital money can only be used online, while cash can be used anywhere.

• Cash is a type of digital money.

• Cash is physical currency; digital money is electronic currency.

How do exchange rates affect buying goods?

• Exchange rates only influence the quantity of goods available.

• Exchange rates affect buying goods by influencing their prices in different currencies.

• Exchange rates have no impact on the prices of goods.

• Buying goods is only affected by local taxes, not exchange rates.