Which of the following items serve as a medium of exchange in the United States?
I. $100 cash
II. 50 euros
III. the balance in your checking account
IV. a $1,000 corporate stock that you own
A) I only
B) I and II
C) I, II, and III
D) I and III
E) I, II, III, and IV

Question

Which of the following items serve as a medium of exchange in the United States? 
I. $100 cash
II. 50 euros
III. the balance in your checking account
IV. a $1,000 corporate stock that you own
A) I only
B) I and II
C) I, II, and III
D) I and III
E) I, II, III, and IV

Quizplus · Accepted Answer

Only items that are widely accepted as payment for goods and services serve as a medium of exchange. In the United States, the only item listed that fits this definition is $100 cash (I) and the balance in your checking account (III), so choices B, C, and E can be eliminated. 50 euros (II) cannot serve as a medium of exchange in the United States. Corporate stock (IV) is not considered a medium of exchange because it is not widely accepted as a form of payment. Therefore, the correct answer is D.

Which of the Following Items Serve as a Medium of Exchange