23. The major problem of a currency that is fractionally backed and convertible into a precious metalis that ofA) clipping, which debases the metal coins.B) counterfeiting.C) maintaining its convertability into the metal.D) paper money being less durable than gold.E) perennial shortages of paper currency

The biggest demerit of having paper money as currency is that itA. brings inflation to the economy.B. causes deficit in balance of payment.C. adversely affects an agrarian economy.D. demotivates producers to produce goods and services.

The downsides of utilizing a fixed currency include its:Arelative lack of use worldwide.Breliance on a finite resource, such as gold.Cstability, due to having a value established against a precious metal.Dinability to influence the currency with monetary policy.

________ money could be used for some other purpose other than as a medium ofexchange, for example, gold coins could be melted down and turned into gold jewelry.A) CommodityB) FiatC) PaperD) Electronic

For much of U.S. history, citizens could exchange paper dollars for a certain amount of gold. This made paper money in the United States an example of:A.commodity money.B.fiat money.C.inflated money.D.representative money.

Which outcome is the most likely result of a country's currency becoming more valuable over time?A.The country will need to adopt a fixed exchange rate to help its economy grow.B.The country will need to adopt a flexible exchange rate to stabilize its economy.C.The country will be able to import more goods without spending more money.D.The country will be forced to export more goods to make up for increased imports.