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Question
Which one of the following is not a modern form of money?
Options
Demand deposits
Paper currency
Coins
Precious metals
Solution
Precious metals
Explanation:
Precious metals like gold and silver are not considered modern forms of currency. Demand deposits, paper currency, and coins are all modern kinds of money that are commonly used in today's economy.
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Match the following:
| Column I | Column II | ||
| A. | Currency | (i) | Something which is commonly used as medium of exchange |
| B. | Bank money | (ii) | Currency and demand deposits |
| C. | Money | (iii) | Bank demand deposits |
| D. | Modern form of money | (iv) | Paper notes + coins |
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What is fiat money?
