Stages in Exchange Development
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Questions and Answers

What is the key characteristic that differentiates the "Use of Commodity as Money" stage from the "Barter/Direct Stage"?

  • The introduction of credit money.
  • The use of non-metallic goods as money.
  • The establishment of economic interdependence.
  • The widespread acceptance of a specific good as a medium of exchange. (correct)

    • Which of the following difficulties associated with barter is addressed by the use of "Credit Money"?

  • It is cumbersome, inconvenient and indivisible.
  • No double coincidence of wants.
  • Products do not have the same value.
  • Lack of store value. (correct)

    • Which of the following BEST describes the concept of "Purchasing Power"?

  • The rate at which prices increase or decrease over time.
  • The amount of goods and services a person owns.
  • The amount of money a person possesses.
  • The ability to use money to buy goods or services. (correct)

    • What distinguishes "Legal Tender Money" from other forms of money?

    <p>It is accepted by law as a means of payment for all debts and obligations. (A)</p> Signup and view all the answers

    In the context of money, what is the underlying concept behind the saying "Money talks"?

    <p>The ability of money to influence people's decisions. (A)</p> Signup and view all the answers

    What is the name of the feature that allows you to see different colors depending on the angle you hold the Philippine banknote?

    <p>Blue Iridescent Figure (B)</p> Signup and view all the answers

    How do the 'Tactile Dots' feature enhance the security of the Philippine banknote?

    <p>They help visually impaired individuals identify the denomination of the banknote. (C)</p> Signup and view all the answers

    Which of these security features is NOT visible on the surface of the Philippine banknote?

    <p>Embossed Prints (C)</p> Signup and view all the answers

    Which of the following is an example of a metallic security feature found on a Philippine banknote?

    <p>Flying Eagle (C)</p> Signup and view all the answers

    What is the primary purpose of the 'Sampaguita Clear Window' on the Philippine banknote?

    <p>To allow the user to see through the banknote (C)</p> Signup and view all the answers

    Which of the following is NOT a function of money?

    <p>Unit of account (D)</p> Signup and view all the answers

    What is the difference between commodity money and currency?

    <p>Commodity money has an intrinsic value, while currency has a value assigned by the government. (C)</p> Signup and view all the answers

    Which of the following describes 'Domestic currency'?

    <p>Currency that can only be used within the country it originated from. (A)</p> Signup and view all the answers

    Flashcards

    Direct Appropriation Stage

    Early man's needs were met by natural resources.

    Barter/Direct Stage

    Goods and services exchanged directly, ending self-sufficiency.

    Commodity as Money

    Goods accepted widely due to usefulness and scarcity.

    Legal Tender

    Money recognized by law for all obligations.

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    Purchasing Power

    The amount you can buy with your money.

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    Sampaguita Clear Window

    A transparent feature on Philippine banknotes for authenticity.

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    Polymer Substrate

    A strong, flexible material used for Philippine banknotes.

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    Enhanced Value Panel

    A security feature that reveals the denomination when tilted.

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    Shadow Thread

    A security thread that appears when the banknote is held up to light.

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    Functions of Money

    The roles money serves in the economy: medium of exchange, etc.

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    Medium of Exchange

    Money used as a tool for buying goods and services.

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    Standard Unit of Value

    Money helps express value of goods and services consistently.

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    Commodity Money

    Money made from valuable commodities like metals.

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    Study Notes

    Stages in Exchange Development

    • Direct Appropriation Stage: Early humans met needs directly from natural resources.
    • Barter/Direct Exchange Stage: Goods and services were exchanged directly for other goods and services. This led to economic interdependence.
    • Commodity Money Stage: Certain goods gained wide acceptance as a medium of exchange due to usefulness, beauty, scarcity, and rarity.
    • Credit Money: Money with a monetary value greater than its material value.

    Money

    • Intrinsic value is equal to material, monetary value.
    • Derived from the Latin word "Moneta."
    • Any item symbolizing perceived value used as a medium of exchange for goods and services; debts and obligations.
    • Purchasing power is the amount that can be bought with money, it decreases with rising prices.

    Difficulties of Barter

    • Products don't always have the same value.
    • No guarantee of finding someone who wants what you have to offer.
    • Lack of store value and divisibility.
    • It is cumbersome, inconvenient, and indivisible.

    Types of Money

    • Non-metallic: Rice, corn, wheat, salt, tea, cattle.
    • Metallic: Gold, silver, copper.
    • Money acceptable by law for all debts.
    • Philippine banknotes and coins issued by BSP.

    Functions of Money

    • Medium of exchange: A common medium for exchanges.
    • Unit of value: Measures the value of goods and services.
    • Store of value: Can be stored for future use.
    • Standard of deferred payment: Used to settle future debts.

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    Related Documents

    PBON02B Lesson 1 PDF

    Description

    Explore the evolution of exchange systems from direct appropriation to credit money in this informative quiz. Understand the complexities of barter and how money gained intrinsic and extrinsic values. Test your knowledge on these fundamental economic concepts.

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