Joshua and Ryzard Buy the Same Pair of Flip Flops

question 57

Multiple Choice

Joshua and Ryzard buy the same pair of flip flops, but each in the wrong size. Joshua proposes a size swap with Ryzard. This is an example of

• A)barter, since the flip flops in the correct size represent a medium of exchange.
• B)barter, since the flip flops in the correct size have intrinsic value to both Joshua and Ryzard.
• C)money, since the flip flops in the correct size do not have any intrinsic value.
• D)money, since the flip flops in the correct size represent a medium of exchange.

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Definitions:

Aggregate Supply Curve

The aggregate supply curve represents the total quantity of all goods and services that producers in an economy are willing and able to supply at different price levels.

Government Purchases

Expenditures by government entities on goods and services that directly fulfill governmental functions or public needs.

Taxes

Mandatory contributions to state revenue, levied by the government on workers' income and business profits or added to the cost of some goods, services, and transactions.

Aggregate Demand Curve

A graph showing the relationship between the total quantity of goods and services demanded across all sectors of an economy and the overall price level.