7.
What are the four functions served by money?
8.
How does the existence of money simplify the process of buying and selling?
9.
What is the double-coincidence of wants?
10.
What components of money are counted as part of M1?
11.
What components of money are counted in M2?
12.
Why is a bank called a financial intermediary?
13.
What does a balance sheet show?
14.
What are the assets of a bank? What are its liabilities?
15.
How do you calculate the net worth of a bank?
16.
How can a bank end up with a negative net worth?
17.
What is the asset–liability time mismatch that all banks face?
18.
What is the risk if a bank does not diversify its loans?
19.
How do banks create money?
20.
What is the formula for the money multiplier?