Question

1. Rank the following in how closely they fit the definition of money, starting

from the one which is least like money. Explain your ranking and why each

object is less or more like money.

a. Bitcoin

b. Stock option

c. 1 year corporate bond

d. 2 year Government bond

e. Gold

f. A computer

g. The knowledge you get from taking this course

Answer 1

G. The knowledge you get from taking this course - Fit least in the deifinition of Money as it need more conveyance to sell the knowledge because it can't be derived directly as good.

f. A computer - Fit the second last from the list as it's a good and can be encash into the money, but it need sometime to change into the cash from it's sale.

d. 2 year Government bond - It's less liquid because it will take time to get liquid.

e. Gold - Gold can be treated as good as cash but it also required some time to be liquid.

c. year corporate bond - It's less liquid because it will take time to get liquid

a & b. Bitcoin & stock option - both are as good as cash because they can converted into money immediately