Question 1: 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.

Question 2: Money provides a universally accepted means of payment so that people do not have to rely on barter. In this way, it functions as a

A) form of credit.

B) medium of exchange.

C) store of value.

D) unit of account.

Question 3: Which of the following assets is the most liquid?

A) Land.

B) Gold.

C) Stocks.

D) Money.

Question 4: Which of the following is the best description of fiat money?

A) Coins made of gold and silver.

B) Paper money that can be redeemed for gold or silver.

C) Legal tender that has no intrinsic value.

D) Checking account and debit cards.

Question 5: In the United States, the largest component of the M1 money supply is

A) currency in circulation.

B) smll time deposits.

C) checkable deposits.

D) traveler's checks.

Question 6: Which of the following is not included in the money supply?

A) credit card balances.

B) currency.

C) checkable deposits.

D) large time deposits.

Question 7: Which of the following groups oversees and administers the Federal Reserve System?

A) The President's Council of Economic Advisors.

B) The House of Representatives.

C) The U.S. Treasury Department.

D) The Board of Governors.

Question 8: What is the primary function of the Federal Open Market Committee?

A) Monitoring and supervising the Fed member banks.

B) Directing the purchase and sale of government securities.

C) Advising the Fed's Board of Governors.

D) Setting the discount rate and the federal funds rate.

Question 9: Prior to the Great Depression, if your bank failed, you would lose any funds you had on account with that bank. Which of the following was created to address this problem?

A) The gold standard.

B) The Thrift Bailout Bill.

C) The Federal Deposit Insurance Corporation (FDIC).

D) The Federal Open Market Committee (FOMC).

Question 10: Which of the following laws increased competition among financial institutions and gave the Fed greater control over nonmember banks?

A) The Federal Reserve Act.

B) The Equal Credit Opportunity Act.

C) The Monetary Control Act.

D) The Thrift Bailout Bill.