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Chapter 13: Problem 3

The basic alternative to money in the United States would be (LO2) a) gold b) barter c) stealing d) the underground economy

Short Answer

Expert verified
b) Barter - This is the basic alternative to money in the United States, as it involves the direct exchange of goods or services without using any form of currency.

Step by step solution

01

Understand the given options

Before selecting the best alternative to money, let's first understand each of these options: a) Gold: Precious metal that can be exchanged for goods and services. b) Barter: Exchange of goods or services directly without using money. c) Stealing: Taking someone else's property without permission. d) The underground economy: Illegal or black-market activities that are not reported to the government.
02

Eliminate incorrect options

Firstly, eliminate the options that are morally, ethically, or legally incorrect: c) Stealing should be eliminated as it is against the law. d) The underground economy should also be eliminated as it is illegal and not reported to the government.
03

Choose the best alternative

Now we are left with two options: a) Gold b) Barter Between these two options, the barter system is the most basic and common alternative to money. In a barter system, people exchange goods and services directly without using any form of currency. While gold can also be used as a medium of exchange, it still functions as a form of currency and is not as basic or common as the barter system.
04

Conclusion

Based on the step-by-step elimination and analysis, the answer to the given question is: b) Barter - This is the basic alternative to money in the United States, as it involves the direct exchange of goods or services without using any form of currency.

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Most popular questions from this chapter

Which statement is true? ( \(\mathrm{LO} 2)\) a) Checks are not money. b) A small part of our money supply is silver ccrtificates. c) Most of our money supply is in the form of currency. d) None of these statements is true.

Which is the most important job of money? (LO1) a) Medium of exchange b) Store of valuc c) Standard of value d) Receipt for gold

Which statement is true? (LO3) a) Credit cards are a form of money. b) Debit cards are a form of money. c) M2 is about six times the size of M1. d) \(\mathrm{M} 1\) is about six times the size of \(\mathrm{M} 2\).

John Maynard Keynes identified three motives for holding money. Which motive listed below did Keynes not identify? (L.O4) a) Transactions b) Precautionary c) Psychological d) Speculative

To get a bank charter, you need to demonstrate each of the following, except (LO6) a) that your community needs a bank or an additional bank b) that you have sufficient banking experience c) that you have enough capital to start a bank d) that you are of good character
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