HERCOR COLLEGE

Riverside Campus, Roxas Avenue, Roxas City

COLLEGE OF BUSINESS ADMINISTRATION

FIN1: PRINCIPLES OF MONEY, CREDIT AND BANKING
2nd Sem; AY: 2018-2019

PRELIM EXAMINATION

NAME, YEAR AND SECTION: DATE:

GENERAL INSTRUCTIONS:
Only calculators, pens and papers are allowed during the exams. Cell phones should be in silent mode and kept inside the bag.
Strictly no texting or calling inside the classroom during the examination. STRICTLY NO ERASURES. Cheating (e.g., talking,
discussion, asking, looking and the likes) is strictly prohibited. Once caught, you are not allowed to finish the exam and you will
be given a grade of 5.0 for this particular exam. If you have questions, please ask the teacher instead.

SET A

I. MULTIPLE CHOICE (20 POINTS). Choose and select by encircling your best choice for each item.

1. Goods and services are expressed in relative values of money. Their prices are related to the value of money, which serves as
a yardstick when comparing items.
a. medium of exchange c. store of value
b. unit of account or standard of value d. standard of deferred payment
2. Coins of the same denomination must have uniform weight of metal alloy, fineness, shape, size and inscriptions. Paper bills of
the same denomination must possess uniform design, size, color, and other physical characteristics.
a. malleability b. homogeneity or uniformity c. cognizability d. divisibility
3. The peso is divided into one hundred (100) equal parts called “centavos.” By its availability in several denominations, coins
and paper bills conveniently allow money to finance transactions of various magnitudes.
a. general acceptability b. durability c. portability d. divisibility
4. Money serves as a physical means for conducting business transactions.
a. medium of exchange c. store of value
b. unit of account or standard of value d. standard of deferred payment
5. It is defined as anything authorized by law to be generally accepted as a medium of exchange and as a standard of value and
has no reference to the general standing of the person who offers it as payment for goods and services.
a. money b. legal tender c. currency d. none of these
6. The place for manufacturing money
a. mint b. minting c. coining d. coinage
7. The following statements are true, except
a. Total coinage, total issue, and total circulation should be restricted.
b. The market value of the metal coins should be well below the face values.
c. The coins should be legal tender in private and public payments.
d. none of these
8. Money evolved from simple forms or things with intrinsic value such as rice, corn, wheat, salt, tobacco, sugar, copper, wire,
gold, and silver.
a. commodity money b. metallic money c. paper money d. coins
9. Any kind of money which, according to law, must be generally accepted when offered as payment for any obligation expressed
in terms of the country’s monetary unit.
a. currency b. peso c. legal tender d. denominations
10. STATEMENT 1: Notes and coins issued by the Bangko Sentral shall be assets of the Bangko Sentral and maybe issued only
against and in amounts not exceeding the assets of the Bangko Sentral.
STATEMENT 2: All expenses incurred in the printing of notes and the minting of coins shall be shouldered by the Bangko
Sentral.
a. True; True b. True; False c. False; True d. False; False

II. ESSAY (10 POINTS). Briefly discuss.

How important money is to you as an individual?

If you don’t fight for what you want, don’t cry for what you’ve lost. (Will Smith)

END OF EXAMINATION

Prepared by:

JOHN KHEVIN V. LIMPOCO, CPA

Course Facilitator