For an Asset to Be a "Means of Payment," the Asset

question 18

Multiple Choice

For an asset to be a "means of payment," the asset

• A) requires a double coincidence of wants.
• B) must be able to be used to settle a debt.
• C) must be valuable and backed by the government.
• D) must be used when bartering.
• E) must be valuable and backed by gold.

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Definitions:

Interest Rate Spread

The difference between the interest rates of two different financial instruments, often highlighting the comparative risk or return.

Insurance Premium

The amount that individuals or organizations must pay for their insurance policies, covering a wide range of risks.

Risk Premium

The additional return expected by an investor for holding a risky asset rather than a risk-free asset, compensating for the extra risk.

Human Capital

The economic value of a worker's experience and skills, including factors like education, training, intelligence, skills, health, and other things employers value.