Functions of Money

EIB – APRIL 2023 – LEVEL I – Q7 – Classifications of Money and Related Concepts

This question covers stating classifications of money, defining money supply, functions of money, advantages of open market operations, and the effect of rising interest rates on money's current value.

Question

a) State the three main classifications of money.

bi) Define the term money supply.

bii) State two main functions of money.

c) Mention three main advantages gained in the use of open market operations.

d) What happens to the current value of a given sum of money if the interest rate rises?

Answer

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Tags: classifications of money, Functions of Money, interest rate effects, money supply definition, open market operations advantages
Level: Level 1

Series: APR 2023

EIB – APR 2024 – L1 – Q7 – Characteristics of Money, Functions of Money, Reserve Ratio in Inflation Control, Money Supply, Nominal vs Real Interest Rates

This question addresses characteristics and functions of money, the central bank's use of reserve ratios for inflation control, the definition of money supply, and the distinction between nominal and real interest rates

Question

(a) Money requires some characteristics to enable it function well in the Modern Economy. State any two (2) of such characteristics of money. [4 marks]

(b) The Modern Economy is preferred to the Barter System mainly due to the Functions of Money. Explain any four (4) Functions of Money in a Modern Economy. [4 marks]

(c) How does the Central Bank use Reserve Ratio to reduce Inflation? [4 marks]

(d) Define the term Money Supply. [4 marks]

(e) With examples, distinguish between Nominal Interest Rates and Real Interest Rates. [4 marks] (Total: 20 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Barter System, Central Bank Policy, Characteristics of Money, Functions of Money, Inflation Control, Money Supply, Nominal Interest Rates, Real Interest Rates, Reserve Ratio
Level: Level 1

Topic: Money; Government
Series: APR 2024

EIB – APRIL 2023 – LEVEL I – Q7 – Classifications of Money and Related Concepts

This question covers stating classifications of money, defining money supply, functions of money, advantages of open market operations, and the effect of rising interest rates on money's current value.

Question

a) State the three main classifications of money.

bi) Define the term money supply.

bii) State two main functions of money.

c) Mention three main advantages gained in the use of open market operations.

d) What happens to the current value of a given sum of money if the interest rate rises?

Answer

Find Related Questions by Tags, levels, etc.

Tags: classifications of money, Functions of Money, interest rate effects, money supply definition, open market operations advantages
Level: Level 1

Series: APR 2023

EIB – APR 2024 – L1 – Q7 – Characteristics of Money, Functions of Money, Reserve Ratio in Inflation Control, Money Supply, Nominal vs Real Interest Rates

This question addresses characteristics and functions of money, the central bank's use of reserve ratios for inflation control, the definition of money supply, and the distinction between nominal and real interest rates

Question

(a) Money requires some characteristics to enable it function well in the Modern Economy. State any two (2) of such characteristics of money. [4 marks]

(b) The Modern Economy is preferred to the Barter System mainly due to the Functions of Money. Explain any four (4) Functions of Money in a Modern Economy. [4 marks]

(c) How does the Central Bank use Reserve Ratio to reduce Inflation? [4 marks]

(d) Define the term Money Supply. [4 marks]

(e) With examples, distinguish between Nominal Interest Rates and Real Interest Rates. [4 marks] (Total: 20 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Barter System, Central Bank Policy, Characteristics of Money, Functions of Money, Inflation Control, Money Supply, Nominal Interest Rates, Real Interest Rates, Reserve Ratio
Level: Level 1

Topic: Money; Government
Series: APR 2024

Question Tag: Functions of Money

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EIB – APRIL 2023 – LEVEL I – Q7 – Classifications of Money and Related Concepts

This question covers stating classifications of money, defining money supply, functions of money, advantages of open market operations, and the effect of rising interest rates on money's current value.

EIB – APR 2024 – L1 – Q7 – Characteristics of Money, Functions of Money, Reserve Ratio in Inflation Control, Money Supply, Nominal vs Real Interest Rates

This question addresses characteristics and functions of money, the central bank's use of reserve ratios for inflation control, the definition of money supply, and the distinction between nominal and real interest rates

EIB – APRIL 2023 – LEVEL I – Q7 – Classifications of Money and Related Concepts

This question covers stating classifications of money, defining money supply, functions of money, advantages of open market operations, and the effect of rising interest rates on money's current value.

EIB – APR 2024 – L1 – Q7 – Characteristics of Money, Functions of Money, Reserve Ratio in Inflation Control, Money Supply, Nominal vs Real Interest Rates

This question addresses characteristics and functions of money, the central bank's use of reserve ratios for inflation control, the definition of money supply, and the distinction between nominal and real interest rates

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EIB – APRIL 2023 – LEVEL I – Q7 – Classifications of Money and Related Concepts

This question covers stating classifications of money, defining money supply, functions of money, advantages of open market operations, and the effect of rising interest rates on money's current value.

You're reporting an error for "EIB – APRIL 2023 – LEVEL I – Q7 – Classifications of Money and Related Concepts"

EIB – APR 2024 – L1 – Q7 – Characteristics of Money, Functions of Money, Reserve Ratio in Inflation Control, Money Supply, Nominal vs Real Interest Rates

This question addresses characteristics and functions of money, the central bank's use of reserve ratios for inflation control, the definition of money supply, and the distinction between nominal and real interest rates

You're reporting an error for "EIB – APR 2024 – L1 – Q7 – Characteristics of Money, Functions of Money, Reserve Ratio in Inflation Control, Money Supply, Nominal vs Real Interest Rates"

EIB – APRIL 2023 – LEVEL I – Q7 – Classifications of Money and Related Concepts

This question covers stating classifications of money, defining money supply, functions of money, advantages of open market operations, and the effect of rising interest rates on money's current value.

You're reporting an error for "EIB – APRIL 2023 – LEVEL I – Q7 – Classifications of Money and Related Concepts"

EIB – APR 2024 – L1 – Q7 – Characteristics of Money, Functions of Money, Reserve Ratio in Inflation Control, Money Supply, Nominal vs Real Interest Rates

This question addresses characteristics and functions of money, the central bank's use of reserve ratios for inflation control, the definition of money supply, and the distinction between nominal and real interest rates

You're reporting an error for "EIB – APR 2024 – L1 – Q7 – Characteristics of Money, Functions of Money, Reserve Ratio in Inflation Control, Money Supply, Nominal vs Real Interest Rates"

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