What Are the Two Features of Money That Distinguish It

question 265

Multiple Choice

What are the two features of money that distinguish it from all other assets in the economy?

• A) Money is government issued and it is redeemable for gold or silver.
• B) Money is accepted as a medium of exchange and it is the common unit of account used to express prices.
• C) Money is part of every barter transaction and it is divisible.
• D) Money is a common unit of account and it can also be traded for other currencies at a guaranteed exchange rate.

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Definitions:

Par-Common Stock

The face value of common stock as stated in the corporate charter, which may differ from its market value.

Stockholders' Equity

The remaining value in a corporation's assets once all its debts have been subtracted, indicating the ownership stake.

Account Balances

The amounts of money held in or owed on an account at a particular point in time.

Retained Earnings

The portion of a company's profits that is not distributed as dividends to shareholders but is kept within the company for reinvestment.