WRITE THE QUESTION NUMBER AND ANSWER USING CAPITAL LETTER ONLY. 1. Money ________. A. is always composed of coins and paper C. requires a double coincidence of wants B. loses its value as it becomes older D. is any commodity that is generally acceptable as a means of payment 2. The functions of money are A. medium of exchange and the ability to buy goods and services C. pricing, contracts, and means of payment. B. medium of exchange, unit of account, and means of payment D. medium of exchange, unit of account, and store of value 3. Matthew purchases a candy bar with his allowance. This purchase represents using money as A. a medium of exchange C. an unit of account B. a store of value D. none of the above 4. M1 includes A. currency, checking deposits and traveler's checks. C. money, checking deposits and traveler's checks B. money, stocks and bonds. D. money market mutual funds, stocks and bonds 5. The definition of M2 includes A. M1 C. time deposits. B. savings deposits D. all of the above 6. Which of the following is NOT a monetary policy tool of the Federal Reserve? A. changes in required reserves C. deposit insurance B. last resort loans D. open market operations 7. Gross domestic product is a measure of the total value of all A. sales in an economy over a period of time C. final goods and services produced in an economy over a period of time B. consumer income in an economy over a period of time. D. capital accumulation in an economy over a period of time. 8. GDP does not directly include intermediate goods because A. intermediate goods are not valuable C. that would count the intermediate goods twice. B. intermediate goods are not useful to consumers D. that would understate the true size of GDP 9. The circular flow shows that the household sector earns its income by A. selling factors of production C. selling goods and services B. buying factors of production D. selling financial assets 10. Double counting (counting the same thing twice) in GDP accounting is avoided by not including A. net exports C. illegal activities. B. intermediate goods. D. depreciation Note: no need explanation! just choice right ans.