1. What is a barter economy? 2. What is the difference between commodity and fiat money? 3. What is an example of a good that has been used as commodity money in the past? 4. What are the three functions of money? 5. Why does the Central Bank set a required reserve ratio (R)? 6. What is the money multiplier? 7. What are the three ways the Central Bank controls the money supply? Describe what they do with each three when a) increasing and b) decreasing the money supply. 8. What are the limitations for the role of central bank in determining the MS? 9. Which list ranks assets from most to least liquid? 10. Monev is the most liquid asset available because 11. When an economy uses silver as money, then that economv's monev 12. You receive money as payment for babysitting your neighbors' children. This best illustrates which function of money? 13. Which of the following best illustrates the medium of exchange function of money? 14. The Central Bank does all except which of the following? 15. If the reserve ratio is 10 percent, the money multiplier 16. When the Central Bank conducts open market purchases, reserves/money supply 17. If the reserve ratio is 8 percent, banks do not hold excess reserves, and people do not hold currency, then when the Central Bank purchases $20 million of government bonds. monev subblv 18. The Central Bank increases the reserve requirement and makes open market purchases. Which of these by itself will increase the monev supolv? 19. In a fractional-reserve banking system, a decrease in reserve requirements 20. In a svstem of 100-percent-reserve banking, Table 29-6. Bank of Springfield 21. Refer to Table 29-6. If the Bank of Springfield has lent out all the money it can given its level of deposits, then what is the reserve requirement? A debit card is more similar to a credit card than to a check -U.S. dollars are an example of commodity money and cigarettes used to make trades are an example of fiat money . M1 includes savings deposits. - M2 is both larger and more liquid than M1. Credit cards are a medium of exchange. Because of the multiple tools at its disposal, Central bank can control the money supply very precisely