Money functions as:

Multiple Choice

• a store of purchasing power
• a measure of value
• a means of exchange
• a store of purchasing power and a measure of value only
• a store of purchasing power, a measure of value, and a means of exchange

The reserve ratio is found using the following formula:

Multiple Choice

• excess reserves/desired reserves
• total reserves/deposits
• deposits/desired reserves
• desired reserves/deposits
• excess reserves/deposits

Currency held within chartered banks is considered to be part of:

Multiple Choice

• the M2 definition of the money supply
• the M1 + definition of the money supply
• the M2 + definition of the money supply
• none of the definitions of the money supply
• the M3 definition of the money supply

The value of the money multiplier is found using the formula:

Multiple Choice

• 1/MPC
• 1/excess reserves
• 1/MPW
• 1/reserve ratio
• 1/desired reserves

Demand deposits are classified as money because:

Multiple Choice

• they earn significant interest income for the depositor
• they are ultimately the obligation of the government
• they can be readily used in the making of purchases and payment of debts
• banks hold stocks equal to the value of their outstanding deposits
• banks hold currency equal to the value of their outstanding deposits