601.2 Lesson - monetaryPremium

Screen: monetaryPremium

Headline: Monetary Premium

Reward: 2

Text: If the value of money is not based on its scarcity, it may not be as reliable as a way to store wealth. In this case, other things that are scarce, such as assets or resources, may become more valuable and be used as a substitute for money.

This additional value is known as a monetary premium. When the usual form of money is not working well, people may turn to other things that are rare or hard to obtain as a way to exchange value.

Some historical forms of money had no other use or value besides being used as a way to trade for other things. The difference between the value of something as money and its value for its other uses is the monetary premium.

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QUIZ

Question: What is a monetary premium?

Answer: The difference in value between something's use as money and its value for its other uses

Feedback: Congratulations! You know your stuff when it comes to monetary premiums. A monetary premium is the additional value that something can have when it is used as a substitute for money. Good job

Correct: true

Answer: An extra fee added to the price of goods and services

Feedback: Sorry, wrong answer! A monetary premium has nothing to do with paying extra for things

Correct: false

Answer: A monetary premium has nothing to do with paying extra for things

Feedback: Nope! A monetary premium is not a discount, it's actually the opposite.

Correct: false