You have recently visited a foreign country

1. What is money?

c) a medium of exchange

 

2. Why can money serve as a standard of value?

c) it determines the relative cost of goods and services

 

3. Is private production of money legal?

a) no

 

4. What is necessary in a barter economy?

a) double coincidence of wants

 

5. What is the essential condition for survival of token money?

b) restriction to the right to supply it

 

6. What is token money?

c) coins and banknotes

 

7. What is the distinctive feature of production of paper money?

c) tiny cost

 

8. What does money determine?

a) relative cost of different goods and services

 

9. How did people get goods in primitive societies?

b) they exchanged one thing for another

 

10. What was each person in a barter economy?

c) a seller and a buyer