Barter is the:
a. direct exchange of goods and services.
b. exchange of goods, but not services.
c. system that does not depend on a coincidence of wants.
d. system used in advanced economies.

Anything can be money if it acts as a:
a. unit of account.
b. store of value.
c. medium of exchange.
d. All of the above must be correct.

M1 refers to:
a. Federal Reserve Notes and gold certificates.
b. Currency held by the public plus checking account balances.
c. The largest of the money-supply definitions.
d. None of the above.

The Fed:
a. has little control over the money supply.
b. serves as the central bank for the United States.
c. often uses a mix of lower taxes in its fiscal policy.
d. ensures commercial bank profitability.

Any item can successfully serve as money.

In order for barter to occur, traders must have a:
a. unit of account.
b. coincidence of wants.
c. medium of exchange.
d. central banking facility.

The use of a dollar bill to buy a concert ticket represents the function of money as a:
a. medium of exchange.
b. unit of account.
c. store of value.
d. all of the above.

Which of the following is a desirable property of money?
a. Scarcity.
b. Portability.
c. Divisibility.
d. All of the above.

Decisions regarding purchases and sales of government securities by the Fed are made by the:
a. Federal Funds Committee.
b. Discount Committee.
c. Federal Open Market Committee.
d. FDIC.

Barter is a system of exchange that does not depend on a coincidence of wants

A problem with barter exchange when there are many goods is that in a barter system
a. transactions costs are minimized.
b. there exists a multiple number of prices for each good.
c. exchange of services is impossible.
d. there is only one store of value.

One hundred dollars on deposit in a checking account represents the use of money as a:
a. medium of exchange.
b. store of value.
c. unit of account.
d. coincident exchange.

Which one of the following is part of the official money supply in the United States?
a. Federal Reserve Notes.
b. Gold bars.
c. Common stock.
d. Silver coins.

The Federal Reserve System is divided into:
a. 2 districts.
b. 12 districts.
c. 26 districts.
d. 50 districts.
e. 1 district.

The Federal Reserve's most important function is to change the money supply in order to smooth out the business cycle.

The conversion of a barter economy to one that uses money
a. increases efficiency by reducing the need to specialize.
b. increases efficiency by reducing transactions costs.
c. increases efficiency by reducing the need to exchange goods and services.
d. d

Comparing how many dollars it takes to attend college each year to annual earnings on a job represents the use of money as a:
a. medium of exchange.
b. unit of account.
c. store of value.
d. store of coincidence.

Which of the following is considered part of M2?
a. Savings deposits.
b. Money market mutual fund shares.
c. Small time deposits of less than $100,000.
d. All of the above.

If the FOMC increases the money supply, then
the Federal Reserve
a. creates dollars to purchase government bonds from the public.
b. sells government bonds from its portfolio to the public.
c. creates dollars to purchase various types of stocks and bonds

Money is said to be liquid because it is immediately available to spend for goods.

Dollar bills serve as money because...
a. they can be redeemed for gold by the central bank.
b. they are backed by gold.
c. people have confidence that others will accept them as money
d. they have value as a commodity independent of their use as money

Which of the following items does not provide a store of value?
a. Currency.
b. Checkable deposits.
c. Credit cards.
d. All of the above are correct.

A progression of the money supplies from most liquid to least liquid would look like:
a. M3, M2, M1.
b. M3, M1, M2.
c. M1, M2, M3.
d. M2, M3, M1.

Which of the following is not part of the Federal Reserve System?
a. Council of Economic Advisers.
b. Federal Open Market Committee.
c. 12 Federal Reserve District Banks.
d. Board of Governors

The Federal Reserve System is a branch of the Treasury Department.