The two broad monetary standards found in the history of money are
Gold standard and silver standard
Bimetallism and trimetallism
Monometallism and bimetallism
Commodity standard and paper-money standard
Legal tender is the circulating medium under
The gold standard
Bimetallism
Commodity standards
Fiat-money standards
Barter works best
In the absence of a double coincidence of wants
When many different product are available in the economy when money is relatively available to establish relative prices
When money is relatively available to establish relative prices
When each trader has what the other wants and wants what the other has
What are the modern forms of money?
Currency
Plastic money
Demand deposits
All the above
A coincidence of wants happens exists when
Two people want the same thing at the same time
One person wants to but two different things at the same time
The individual who has what I want, also wants what I have
Under the pure gold standard
Circulating notes are fully backed by gold.
The authorities can easily manipulate the money supply
Price stability is difficult to achieve
The power of monetary policy is unlimited
“Bad money drives good money out of circulation.” This is a statement of
Monetary policy rule.
Okun’s law.
Gresham’s law.
The paradox of thrift
Currency with the public is known as
M1
M2
M3
M4
The essential characteristic required before any substance can function as money is that
It be issued by the government
It be backed by a precious metal
The supply of it be unlimited and uncontrolled
People accept it as money
For an asset to act as money, the asset must
Be legally accepted as a medium of exchange
Be commonly accepted by the public as a medium of exchange
Have a physical existence
Be made out of or fully backed by a precious metal
