Brief Principles Of Macroeconomics International Edition 5th Edition By N. Gregory Mankiw – Test Bank

Chapter 11
The Monetary System
TRUE/FALSE
1. In an economy that relies on barter, trade requires a double-coincidence of wants.
ANS: T DIF: 1 REF: 29-0
NAT: Analytic LOC: The role of money TOP: Barter
MSC: Definitional
2. Joe wants to trade eggs for sausage. Lashonda wants to trade sausage for eggs. Joe and Lashonda have a double-coincidence of wants.
ANS: T DIF: 1 REF: 29-0
NAT: Analytic LOC: The role of money TOP: Barter
MSC: Definitional
3. The use of money allows trade to be roundabout.
ANS: T DIF: 1 REF: 29-0
NAT: Analytic LOC: The role of money TOP: Money | Trade
MSC: Definitional
4. Roundabout trade is beneficial for an economy.
ANS: T DIF: 1 REF: 29-0
NAT: Analytic LOC: The role of money TOP: Money | Trade
MSC: Definitional
5. Money allows people to specialize in what they do best, thereby raising everyone’s standard of living.
ANS: T DIF: 2 REF: 29-0
NAT: Analytic LOC: The role of money TOP: Money
MSC: Interpretive
6. When money functions as a unit of account, then it cannot be commodity money.
ANS: F DIF: 2 REF: 29-1
NAT: Analytic LOC: The role of money TOP: Money
MSC: Interpretive
7. Demand deposits are balances in bank accounts that depositors can access by writing a check.
ANS: T DIF: 1 REF: 29-1
NAT: Analytic LOC: The role of money TOP: Demand deposits
MSC: Definitional
8. According to economists, a collection of valuable jewels is not money.
ANS: T DIF: 2 REF: 29-1
NAT: Analytic LOC: The Study of economics, and the definitions of economics
TOP: Money MSC: Interpretive
9. A debit card is more similar to a credit card than to a check.
ANS: F DIF: 2 REF: 29-1
NAT: Analytic LOC: The Study of economics, and the definitions of economics
TOP: Money MSC: Interpretive
10. Gary’s wealth is $1 million. Economists would say that Gary has $1 million worth of money.
ANS: F DIF: 1 REF: 29-1
NAT: Analytic LOC: The role of money TOP: Money
MSC: Definitional
11. Marc puts prices on surfboards and skateboards at his sporting goods store. He is using money as a unit of account.
ANS: T DIF: 1 REF: 29-1
NAT: Analytic LOC: The role of money TOP: Money
MSC: Definitional