What kind of money is a gold certificate considered to be?

What is true of representative money?

Representative money is not a money itself, maybe a token or piece of paper that has no intrinsic value but represents money or can be exchanged for something with value. The following are true of representative money, 1. It can be exchanged for a valuable good.

What types of money are included in m2 category check all that apply?

What types of money are included in the M2 category? Check all that apply. currency savings accounts checking accounts commodity money money market accounts

  • Currency.
  • savings accounts.
  • checking accounts.
  • money market accounts.

What is one problem that might commonly occur when?

Two people have different ideas about the value of an item is one problem that might commonly occur when one is bartering. Two people have different ideas about the value of an item.

What is an example of representative money?

Representative money is any medium of exchange, often printed on paper, that represents something of value, but has little or no value of its own (intrinsic value). … More specifically, the term representative money has been used variously to mean: A claim on a commodity, for example gold and silver certificates.

What is the difference between representative money and fiat money?

Fiat money is physical money backed by a government and is considered legal tender. Representative money is backed by a physical commodity such as precious metals or instruments like checks and credit cards. Prior to 1971, the world’s currencies were representative, backed by gold.

How is money related to bartering?

Money is anything widely accepted as final payment for goods and services. Trade without money is called barter. Barter is costly and difficult because both parties must be willing to trade for the item the other person has. When money replaces barter, this makes exchanges less costly and easier to do.

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Why might it be important to know a currency’s exchange rate?

Foreign exchange is the trading of different national currencies or units of account. It is important because the exchange rate, the price of one currency in terms of another, helps to determine a nation’s economic health and hence the well-being of all the people residing in it.

When might it be important to know a currency’s exchange rate?

when planning expenses for an overseas trip when changing money into smaller denominations when preparing to buy something expensive when deciding which college is the best value.

What would happen if currency in all countries had fewer?

If the currency in all countries had fewer denominations, it will get difficult for firms to charge as diverse of prices for goods and services as they can with a currency with a large number of denominations. Price diversity is vital to the profitability of a firm.

What would happen if currency in all countries?

What would happen if currency in all countries had fewer denominations? … Exchanging money between countries would be much easier. People could not charge as many different prices for goods. All goods would be more expensive than they currently are.

What might cause a change in the value of fiat money?

What might cause a change in the value of fiat money? they do not want to carry around large amounts of cash.

What are the 4 types of money?

In a Nutshell. The four most relevant types of money are commodity money, fiat money, fiduciary money, and commercial bank money. Commodity money relies on intrinsically valuable commodities that act as a medium of exchange. Fiat money, on the other hand, gets its value from a government order.

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What type of money has the most value?

The Bahraini dinar is currently the world’s most valuable currency, though it occasionally faces stiff competition with the Kuwaiti dinar for this title.

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