Money

Question 1

Exchange rates can indicate economic health by

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showing the relative strength of different nations’ currencies.

Question 2

What is one problem that might commonly occur when one is bartering?

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Two people have different ideas about the value of an item.

Question 3

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

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

Question 4

Why must old currency be taken out of circulation when new currency is made?

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Too much currency in an economic system will cause inflation.

Question 5

What kind of money is a gold certificate considered to be?

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representative

Question 6

When might it be important to know a currency’s exchange rate?

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when planning expenses for an overseas trip

Question 7

The term liquidity refers to

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how quickly money can be exchanged.

Question 8

Which of these scenarios involves commodity money?

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

Question 9

In the United States, dollar bills, nickels, and dimes are

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different denominations.

Question 10

Which is an advantage of using modern currency instead of a barter system?

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ability to store and use a form that is accepted everywhere

Money Answers