# Online Quiz #4 Answers - Quiz#4 Answers 1 D We use the unit...

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Quiz #4 Answers 1. D  - We use the unit of account function of money to measure the value of all kinds of non-money things  from salaries to value of houses to wealth, etc. 2. A  - As we discussed in our lecture session, fiat money is more prone to the inflation phenomenon.  Commodity money does not always come in small denominations. 3. C  - Credit cards fail the "store of value" function of money and so are not considered money. 4. C  - Cash in the bank is part of bank reserves not money (which would be the demand deposits on the  liability side of the banks balance sheet). 5. D  - His reserves of gold are 1000 ? 600 = 400 pounds sterling and his reserve ratio is 400/1000 = 0.4. 6. C  - In a fractional banking reserve system, banks hold a fraction of their total deposits and loan out the  rest. 7.

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## This note was uploaded on 04/07/2008 for the course ECON 201 taught by Professor Salehie during the Winter '08 term at University of Washington.

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Online Quiz #4 Answers - Quiz#4 Answers 1 D We use the unit...

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