What are the two features of money that distinguish it from all other assets in the economy?
A. Money is a common unit of account and it can also be traded for other currencies at a guaranteed exchange rate.
B. Money is part of every barter transaction and it is divisible.
C. Money is government issued and it is redeemable for gold or silver.
D. Money is accepted as a medium of exchange and it is the common unit of account used to express prices.
Answer: D
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Indicate whether the statement is true or false
A surplus or shortage in the money market is eliminated by adjustments in the price level according to
a. both liquidity preference theory and classical theory. b. neither liquidity preference theory nor classical theory. c. liquidity preference theory, but not classical theory. d. classical theory, but not liquidity preference theory.