Money functions as a store of value if it allows you to:
A. increase your confidence in money.
B. make exchanges in a more efficient manner.
C. measure the value of goods in a reliable way.
D. delay purchases until you want the goods.
Answer: D
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During the mid to late 1990s, the incentives for investment spending were provided by rising
a. aggregate demand. b. real interest rates. c. levels of corporate taxes. d. levels of capital gains taxes.
If the government increases the income tax rate:
A. total income increases. B. disposable income remains unaffected. C. disposable income increases. D. disposable income decreases.
The costs of inflation that arise from trying to reduce cash holdings are known as:
A. shoe leather costs. B. menu costs. C. chain-index costs. D. diminishing costs.
Any point above the budget line
a. is unaffordable. b. means you have spent all your income. c. means you have some income left over. d. means none of the above.