Unit 4 Test Review

Unit 4 Test Review

M/C: barter system, money as a unit of account, purpose of a mortgage, liquid assets, bank runs, the basis for a fiat monetary system, M1 money, debit cards, gold as medium of exchange (money), usefulness of representative money, S and Ls in the 80s, advantages of diversification, terms related to bonds, types of bonds, money market mutual funds, basic components of bonds, conditions of stock splits, pros and cons of different investment options, the basic characteristics of income, growth, common, and preferred stock.
Matching: be familiar with each of the key terms at the beginning of each section.
Short Essay: 1 .what makes a $100 bill worth a $100? 2. Identify the 3 uses of money and give an ex. of each. 3. Explain what the gold standard is and why it isn’t used in the U.S. 4. Explain why investing is an essential part of the free enterprise system. 5. What are futures and options? What is the difference between investing in the stock market and futures and options trading?