Question

unit 1 test - money version a

1. which of the following is not a function of money?

a. medium of exchange
b. store of value
c. means of payment
d. unit of account

1. money works because...

a. it eliminates the need for bartering
b. it increases inflation
c. it prevents the government from collecting taxes
d. it always has intrinsic value

1. what gives u.s. money its value today?

a. gold stored at fort knox
b. full faith and confidence in the u.s. government
c. the federal reserves stockpile of silver
d. its ability to be exchanged for oil

1. u.s. money is considered what type of money?

a. commodity money
b. representative money
c. fiat money
d. trade money

1. which government department oversees the production of coins and paper money?

a. department of commerce
b. department of the treasury
c. interstate commerce commission
d. internal revenue service

1. which government agency prints u.s. paper currency?

a. u.s. mint
b. bureau of labor statistics
c. bureau of engraving and printing
d. treasury enforcement agency

1. which government agency produces u.s. coins?

a. bureau of engraving and printing
b. u.s. mint
c. securities and exchange commission
d. internal revenue service

1. which of the following is not an example of an incentive?

a. employee discounts
b. gift cards for a job well done
c. a day off for high performance
d. an employee luncheon
you are taking version a

Explanation:

1. The functions of money are medium of exchange, store of value, and unit of account. Means of payment is not a distinct function among the main ones.
2. Money eliminates the need for bartering as it provides a common - accepted medium for transactions.
3. U.S. money's value today is based on the full faith and confidence in the U.S. government.
4. U.S. money is fiat money, which is declared legal tender by the government and has no intrinsic value tied to a commodity.
5. The Department of the Treasury oversees the production of coins and paper money.
6. The Bureau of Engraving and Printing prints U.S. paper currency.
7. The U.S. Mint produces U.S. coins.
8. An employee luncheon is more of a general workplace activity and not typically considered an incentive like the others which are directly tied to performance or behavior.

Answer:

1. C. Means of payment
2. A. It eliminates the need for bartering
3. B. Full faith and confidence in the U.S. government
4. C. Fiat money
5. B. Department of the Treasury
6. C. Bureau of Engraving and Printing
7. B. U.S. Mint
8. D. An employee luncheon