Module 02 Quiz

1. Which of the following is the main problem that makes barter an inefficient mechanism of trade in a complex economy?
   • coincidence of wants
   • commodity degradation
   • grain portability
   • valuation difficulty
2. Which of the following are the major functions of money? Choose all that apply.
   • medium of exchange
   • store of value
   • value creation
   • unit of account
3. Which of the following are desirable properties for money to have? Choose all that apply.
   • durability
   • abundance
   • portability
   • fungibility
4. True or False: The difference between commodity money and representative money is that the value of commodity money is roughly equal to the consumable value of the commodity, while the consumption value of representative money is relatively small.
5. Why are people generally willing to accept the U.S. dollar in exchange for valuable goods and services?
   • because they expect to be able to use the dollars to buy other goods and services
   • because they know they can exchange the dollars for a certain amount of precious metal like gold or silver
   • because they are required to do so by law
   • because if all else fails they could always use it as a decorative element