When a Grocery Store Accepts Your $5 Bill in Exchange

question 13

Multiple Choice

When a grocery store accepts your $5 bill in exchange for bread and milk,the $5 bill serves as a

• A)medium of exchange.
• B)unit of account.
• C)store of value.
• D)standard of deferred payment.

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Definitions:

Valuation Techniques

Methods and approaches used to determine the fair value of an asset, liability, or a company, based on assumptions of future cash flows, market trends, or comparative assets.

Fair Value Approach

An accounting method that measures assets and liabilities at estimates of their current market value rather than historical cost.

Quoted Prices

The prices of securities that are publicly listed and available for investors to buy and sell.

Active Markets

Markets where transactions for assets or liabilities occur with sufficient frequency and volume to provide pricing information on an ongoing basis.