Understanding Legal Tender
10 Questions
0 Views

Choose a study mode

Play Quiz
Study Flashcards
Spaced Repetition
Chat to lesson

Podcast

Play an AI-generated podcast conversation about this lesson

Questions and Answers

The government has designed paper currency to be legal tender.

True

People do not accept paper currency in exchange for goods and services.

False

Legal tender means that currency has no value.

False

Goods and services can be exchanged for paper currency.

<p>True</p> Signup and view all the answers

Checks are promises to pay on demand money deposited with a financial institution.

<p>True</p> Signup and view all the answers

Currency is accepted mostly due to market demand alone, without government regulation.

<p>False</p> Signup and view all the answers

Checks cannot be used to pay for goods and services.

<p>False</p> Signup and view all the answers

A check is a form of legal tender.

<p>False</p> Signup and view all the answers

Checks require funds to be deposited with a bank or other financial institution to be valid.

<p>True</p> Signup and view all the answers

Checks are a form of credit issued by the bank.

<p>False</p> Signup and view all the answers

Study Notes

  • Paper currency is widely accepted for transactions due to its designation as legal tender by the government.
  • Legal tender status ensures that creditors must accept it as a means of payment.

Function of Checks

  • Checks serve as written promises to pay a specified amount of money.
  • They are issued against money deposited in a bank or other financial institution.
  • Checks enable individuals to transfer funds from one account to another without needing physical cash.

Studying That Suits You

Use AI to generate personalized quizzes and flashcards to suit your learning preferences.

Quiz Team

Description

This quiz explores the concept of paper currency as legal tender. Learn why people accept it in exchange for goods and services, and the role of government in establishing its value. Test your knowledge on this fundamental economic principle.

More Like This

Legal Tender Money Quiz
6 questions

Legal Tender Money Quiz

PromisedUnderstanding avatar
PromisedUnderstanding
Demonetization in India
5 questions

Demonetization in India

SelfSufficiencyPeace avatar
SelfSufficiencyPeace
Types of Legal Tender Coins in Australia
1 questions
Legal Tender in Economy
10 questions
Use Quizgecko on...
Browser
Browser