ECONOMICS CHAPTER 10-11|TESTS WITH
100% CORRECT ANSWERS
currency - coins and paper bills used as money
six characteristics of currency - durability, portability, divisibility, uniformity, limited supply,
and acceptability
commodity - is an object
commodity money - objects that have value in themselves and that are also used as money
(ex. cattle, salt)
representative money - objects that have value because the holder can exchange them for
something else of value
fiat money - "legal tender" money that has value because the government has ordered that it
is an acceptable means to pay debts
bank - an institution for receiving, keeping, and lending money
the Federalists believed - the country needed a strong central government to establish
economic and social order (centralized banking system)
the Antifederalists favored - leaving most powers in the hands of the states
national bank - a bank chartered, or licensed, by the national government
bank run - widespread panic in which great numbers of people try to redeem their paper
money
greenback - paper currency issued during the Civil War
, gold standard - a monetary system in which paper money and coins are equal to the value of a
certain amount of gold
Federal Reserve System - (Fed) the nation's central banking system
central bank - bank that can lend to other banks in times of need
member bank - bank that belongs to the Fed
Federal Reserve note - the national currency we use today in the United States
Money - anything that serves as a medium of exchange, a unit of account, and a store of value
medium of exchange - anything that is used to determine value during the exchange of goods
and services
barter - the direct exchange of one set of goods or services for another (common in Asia,
Africa, and Latin America)
unit of account - a means of comparing the values of goods and services
store of value - something that keeps its value if it is stored rather than used
Debit cards - a card used to withdraw money (PIN #)
creditor - person or institution to whom money is owed
investment - the act of redirecting resources from being consumed today so that they may
create benefits in the future; the use of assets to earn income or profit
100% CORRECT ANSWERS
currency - coins and paper bills used as money
six characteristics of currency - durability, portability, divisibility, uniformity, limited supply,
and acceptability
commodity - is an object
commodity money - objects that have value in themselves and that are also used as money
(ex. cattle, salt)
representative money - objects that have value because the holder can exchange them for
something else of value
fiat money - "legal tender" money that has value because the government has ordered that it
is an acceptable means to pay debts
bank - an institution for receiving, keeping, and lending money
the Federalists believed - the country needed a strong central government to establish
economic and social order (centralized banking system)
the Antifederalists favored - leaving most powers in the hands of the states
national bank - a bank chartered, or licensed, by the national government
bank run - widespread panic in which great numbers of people try to redeem their paper
money
greenback - paper currency issued during the Civil War
, gold standard - a monetary system in which paper money and coins are equal to the value of a
certain amount of gold
Federal Reserve System - (Fed) the nation's central banking system
central bank - bank that can lend to other banks in times of need
member bank - bank that belongs to the Fed
Federal Reserve note - the national currency we use today in the United States
Money - anything that serves as a medium of exchange, a unit of account, and a store of value
medium of exchange - anything that is used to determine value during the exchange of goods
and services
barter - the direct exchange of one set of goods or services for another (common in Asia,
Africa, and Latin America)
unit of account - a means of comparing the values of goods and services
store of value - something that keeps its value if it is stored rather than used
Debit cards - a card used to withdraw money (PIN #)
creditor - person or institution to whom money is owed
investment - the act of redirecting resources from being consumed today so that they may
create benefits in the future; the use of assets to earn income or profit
