Barter System and Money

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Questions and Answers

What gives the Central Bank the legal right to issue currency notes?

  • Finance Ministry
  • Commercial Banks
  • Supervisors
  • The Government (correct)

Which entity regulates and supervises the proper functioning of commercial banks?

  • Central Bank (correct)
  • Supervisors
  • Government
  • Finance Ministry

What is one of the functions of the Central Bank in relation to commercial banks?

  • Accepts deposits
  • Provides loans with high interest rates
  • Issues currency notes
  • Acts as a financial advisor (correct)

Which term is used to describe the ability of money to hold its value over time?

<p>Store of Value (B)</p> Signup and view all the answers

What type of money is created by the Central Bank with a fixed value equal to a specific amount of gold or silver?

<p>Commodity Money (C)</p> Signup and view all the answers

In the context of money, what role does the Central Bank play as a 'lender of last resort'?

<p>Assisting banks in financial crises (D)</p> Signup and view all the answers

'Legal Tender' refers to:

<p>Money accepted by law for transactions (C)</p> Signup and view all the answers

'CRR' and 'SLR', regulatory terms in banking, stand for:

<p>'Cash Reserve Ratio' and 'Statutory Liquidity Ratio' (D)</p> Signup and view all the answers

'Fiat Money' derives its value from:

<p>'Promise to pay' by the issuer (A)</p> Signup and view all the answers

'Unit of Account' refers to money's function as:

<p>'Standard measuring tool' for comparing prices (A)</p> Signup and view all the answers

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