Banking Answers

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Which of these scenarios involves commodity money?

A girl writes a check to her friend for a stack of valuable comic books.

A boy starts a lemonade stand and sells each drink for twenty-five cents.

A woman offers her neighbor a US silver dollar in exchange for a bicycle.

A man buys some T-shirts and pays with a US fifty-dollar bill.

How is using money related to bartering?

It is a substitute for bartering.

It is the opposite of bartering.

It is a newer form of bartering.

It is an old form of bartering.

A currency’s exchange rate is

how many denominations the currency has.

its stable rate as established by the government.

how easily it can be divided into other currencies.

its changing value relative to other currencies.

Which could be a negative factor of a barter system?

Both individuals easily agree on the value of their goods.

One person may not want or need what the other person is offering.

Goods can be exchanged without the need for any physical currency.

The process requires money so the two people involved can easily come to an agreement.

Exchange rates can indicate economic health by

showing exactly how much of each nation’s currency is liquid.

revealing how much of each nation’s income goes to savings.

showing the relative strength of different nations’ currencies.

examining spending patterns across nations and continents.

People might choose to use a debit card rather than cash for purchases because

they do not want to carry around large amounts of cash.

their banking institutions charge high fees for cash withdrawals.

most items cost less when purchased with a debit card.

debit cards have a higher value than cash and can buy more.

Which of the following is the least liquid?

savings account

checking account

credit account

investment account

To barter means to

sell.

create.

trade.

earn.

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