To increase the money supply, the Fed could()
A. sell government bonds.
B. decrease the discount rate.
C. increase the reserve requirement.
D. None of the above is correct.
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Paper money()
A. has a high intrinsic value.
B. is the primary medium of exchange in a barter economy.
C. is valuable because it is generally accepted in trade.
D. is valuable only because of the legal tender requirement.
An item that people can use to transfer purchasing power from the present to the future is called()
A. a medium of exchange.
B. a unit of account.
C. a store of value.
D. None of the above is correct.
Liquidity refers to()
A. the ease with which an asset is converted to the medium of exchange.
B. a measurement of the intrinsic value of commodity money.
C. the suitability of an asset to serve as a store of value.
D. how many time a dollar circulates in a given year.
The legal tender requirement means that()
A. people are more likely to accept the dollar as a medium of exchange.
B. the government must hold enough gold to redeem all currency.
C. people may not make trades with anything else.
D. All of the above are correct.
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