TF Qu. 123 Gold backs the U.S. money supply.... Gold backs the U.S. money supply. True or False True False

Adopting the Gold Standard for a country’s economy implies that     a. Money supply can be easily increased or decreased   b. Interest rates become flexible     c. Utilizing monetary policy tools becomes constrained     d. Fiscal policy becomes flexible

12 Commodity currencies are less prone to inflation since they have value as commodities and thus are melted down – smelted - when prices reach a certain point. True or False? Explain

Define a put and call on the British pound sterling.

Which type of money has the lowest opportunity cost? a. silver coins b. fiat money c. commodity money d. diamonds e. gold coins

4.People in other countries want to hold U.S. dollars as a  unit of account. medium of exchange.  standard of deferred payment. Store of value

If initial fresh deposits with banks is $25000and legal reserve ratio is $20%calculate total money will be created in the economy?

If you transfer all of your currency to your checking account, then initially, M1 will and M2 will O increase; not change O not change; increase O not change; not change decrease; increase

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