1. Which of the following is the best example of people engaged in barter?

Bill asks for $4,500 for his used car, but when Willis offers $3,800, Bill ends up selling it to him for $4,000 instead.

Stepon uses his debit card to purchase a $30 train ticket.

Noreen gives Lucas a homemade cupcake for his birthday instead of a store-bought gift.

LaVar agrees to swap his comic book for three of Max's baseball cards.

2. Which statement about currency is true?

Currency is coins and/or paper created for use in trade or payment of debts.

Currency is anything generally accepted by people in exchange for services or goods.

Currency is what makes bartering possible.

The terms money and currency mean the same thing..

3. Eamon buys a new barbecue using his credit card. In other words, Eamon has used ______ to purchase the barbecue

fiat money

a loan

currency

a demand deposit

4. Which of the following assets is the most liquid?

stocks

pounds of wheat

checking account balances

savings account balances

5. Which of the following is part of the M1 definition of money?

demand deposits

time deposits

stocks

savings deposits

6. Which of these meets the M2 definition of money, but not the M1 definition of money?

demand deposits

currency

savings deposits

traveler's checks

7. Today, the value of U.S. currency is backed by ______.

the gold standard, with some account for digital currencies

people's faith in its ability to be converted into services and goods

insurance provided by the Federal Deposit Insurance Corporation

the silver standard due to its role in the international market

8. Members of the Federal Reserve Board of Governors are ______.

elected by the U.S. public for lifetime terms

appointed by the U.S. president for terms of 14 years

appointed and removed according to the votes of Fed member banks

chosen at random from the heads of the 12 regional Fed banks, every four years

9. If the Fed lowers the reserve requirement from 10 percent to 8 percent, the result will be ______.

a decrease in the money supply

more borrowing from the Fed by banks

an increase in the money supply

no change in the money supply

10. To increase the money supply, the Fed can ______.

sell bonds

increase reserve requirements

increase the interest rate paid on reserves

decrease the discount rate

11. Penny, an avocado farmer, wants to purchase a new desk that has been priced at $150. Avocados cost $2.00 each, so Penny knows that the desk is equal to 75 avocados. This illustrates money's function as a ______.

store of value

unit of account

medium of exchange

means of deferred payment

12. Which scenario best demonstrates how money acts as a store of value?

Tran knows a bottle of water is $1 and a birthday card is $2, so a birthday card has the same value as two bottles of water.

Natalie buys a new leather purse and a button-down blouse from her favorite boutique for $150.

Anya puts money in her bank, which she plans to spend in several years after she retires.

Gabe borrows money from his mother to fix his car and gives her money every month until he has repaid her.