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1. | Money is defined as anything that is customarily used as __________
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| a) a medium of exchange, a unit of accounting, and a store of value.
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| b) a medium of exchange and a unit of accounting.
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| c) a unit of accounting and a store of value.
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| d) a medium of exchange and a store of value.
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2. | Which of the following is NOT a characteristic of a good medium of exchange?
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| a) It must be portable.
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| b) It must be divisible.
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| c) It must be in abundant supply.
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| d) It must be stable in value.
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3. | The passage of the Coinage Act in 1792 brought order to the monetary system of the United States by __________
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| a) establishing the dollar as the basic unit of currency.
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| b) chartering the First Bank of the United States.
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| c) creating the Comptroller of the Currency position.
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| d) issuing fiat money called greenbacks.
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4. | The Federal Reserve System was established to __________
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| a) create a gold standard.
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| b) control the amount of money in circulation.
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| c) ensure a safe, uniform currency.
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| d) insure the funds of individual depositors.
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5. | Today, banks and savings institutions offer all of the following services EXCEPT __________
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| a) checking accounts.
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| b) interest on checking accounts.
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| c) storage of valuables.
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| d) exchanging dollars for gold or silver.
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6. | All of the following are drawbacks for customers using electronic funds transfer EXCEPT __________
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| a) the increased risks of tampering.
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| b) the increased lack of privacy.
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| c) the reduced time, trouble, and costs.
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| d) the possibility of altering account files.
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7. | One way in which money and near moneys are alike is that __________
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| a) their values are stated in the same terms.
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| b) they are able to be withdrawn immediately.
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| c) they have low liquidity.
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| d) they include assets that require a bank to be notified in advance of withdrawal.
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8. | The M2 definition of money includes __________
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| a) currency, traveler's checks, and checkable deposits.
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| b) near moneys such as money market mutual fund balances and Eurodollars.
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| c) currency, traveler's checks, checkable deposits, and near moneys such as money market mutual fund balances and Eurodollars.
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| d) currency only.
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