2
QuizMultiple Choice

Money

Question 2 • * HSA 26-27 Economics

Which of these scenarios involves commodity money?

Answer
A
A girl writes a check to her friend for a stack of valuable comic books.
B
A boy starts a lemonade stand and sells each drink for twenty-five cents.
C
A woman offers her neighbor a US silver dollar in exchange for a bicycle.
D
A man buys some T-shirts and pays with a US fifty-dollar bill.

Explanation

Commodity money has value because of the material it is made from, not just because people accept it as money. A US silver dollar contains valuable silver, so offering it for a bicycle is an example of commodity money. The check and the fifty-dollar bill are forms of money whose value depends mainly on their acceptance, not their material.

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