Macro Chapter 14

If you write a check on a bank to purchase a used Honda Civic, you are using money primarily as a) a medium of exchange. b) a store of value. c) a unit of account. d) an economic investment.

a) a medium of exchange.

In the United States, the money supply (M1) includes a) coins, paper currency, and checkable deposits. b) currency, checkable deposits, and Series E bonds. c) coins, paper currency, checkable deposits, and credit balances with brokers. d) paper currency, coins, gold certificates, and time deposits.

a) coins, paper currency, and checkable deposits.

If you place a part of your summer earnings in a savings account, you are using money primarily as a a) medium of exchange. b) store of value. c) unit of account. d) standard of value.

b) store of value.

To say that coins are "token money" means that a) their face value is less than their intrinsic value. b) their face value is greater than their intrinsic value. c) their face value is equal to their intrinsic value. d) they are not legal tender.

b) their face value is greater than their intrinsic value.

To say money is socially defined means that a) money has been defined in a Constitutional amendment. b) whatever performs the functions of money extremely well is considered to be money. c) the money supply includes all public and private securities purchased by society. d) society, acting through Congress, specifies what shall be included in the money supply.

b) whatever performs the functions of money extremely well is considered to be money.

Refer to the given table. The value of the dollar in year 2 is a) $1.25. b) $1.33. c) $0.80. d) $0.75.

c) $0.80.

Refer to the table. Money supply M1 for this economy is a) $60. b) $70. c) $130. d) $140.

c) $130.

If you are estimating your total expenses for school next semester, you are using money primarily as a) a medium of exchange. b) a store of value. c) a unit of account. d) an economic investment.

c) a unit of account.

Money functions as a) a store of value. b) a unit of account. c) a medium of exchange. d) All of the above.

d) All of the above.

Currency in circulation is part of a) M1 only. b) M2 only. c) neither M1 nor M2. d) both M1 and M2.

d) both M1 and M2.