In Explaining the Evolution of Money

question 69

Multiple Choice

In explaining the evolution of money

• A)government regulation is the most important factor.
• B)commodity money,because it is valued more highly,tends to drive out paper money.
• C)new forms of money evolve to lower transaction costs.
• D)paper money is always backed by gold and therefore more desirable than checks.

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Definitions:

Opportunity Cost

Giving up on possible rewards from various other options by selecting a single alternative.

Absolute Advantage

A condition in which a country, individual, or company can produce a particular good or service at a lower cost in terms of labor and resources than other entities.

Compasses

Navigation instruments used for determining direction relative to the Earth's magnetic poles.

Specialize And Trade

The economic practice where individuals or entities focus on the production of a limited range of goods or services to gain efficiency and then trade with others to meet their needs.