Money Is Destroyed When

question 95

Multiple Choice

Money is destroyed when:

• A)loans are made.
• B)cheques written on one bank are deposited in another bank.
• C)loans are repaid.
• D)the net worth of the banking system declines.

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Definitions:

Opportunity Cost

The cost of foregone alternatives, representing the benefits that could have been received by choosing the next best alternative.

Retail Value

The price at which a product is sold to the end consumer, typically including markups from wholesale or manufacturing costs.

Barbie Doll

A fashion doll manufactured by the American toy-company Mattel, Inc. and launched in March 1959.

Incremental Cost

The additional cost associated with producing one more unit of output, useful for decision-making on production levels.