Question # 1

Functions of money are

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Medium of exchange

Common measure of value

Store of value

All the three

Relationship of level of prices and quantity of money

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Positive

Negative

Indirect

2nd and 3rd both

Disadvantages of paper money are

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Unstable value

Possibility of inflation

Possibility of wastage

All the three

Quantity theory of money in the form of an equation was presented by

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Prof Fisher

Prof Taussig

Prof Marshall

Prof Renald

Relationship of value of money with quantity of money is

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Direct

Indirect

Inverse

Positive

______ is not considered perfect money

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Note of ten rupees

Note of hundred rupees

Piece of silver

Note of one thousand rupees

Inconvertible paper money is issued by

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Central bank

Commercial bank

Industrial bank

Central government

If face value is equal to the metal value of a coin, it is called as

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Paper money

Token money

Credit money

Standard money

Prices during the situation of inflation

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Increase

Decrease

Do not change

Become zero

Note of 500 rupees is

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token money

credit money

convertible paper money

inconvertible paper money

Basic characteristics of good money are

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General acceptability, durability

Homogeneity,divisibility

Transferability, recognizability, convertibility

All

One of the following is not the cause of deflation

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Decrease in demand for goods

Decrease in consumption

Increase in quantity of money

Increase in supply of goods

World economic depression accured in

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1927

1928

1929

1931

One of the following is not advantage of paper money

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Saving of metals

Saving of coinage

Easy transferability

Perfectly inelastic supply

Unit of account money in Pakistan is

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Rial

Rupee

Dollar

Pound

"Anything which is generally accepted as a medium of exchange and also performs the functions of standard of value and a store of value is money"
This definition of money is stated by

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Prof Walker

Prof Marshall

Prof Crowther

Prof Pigou

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