20. In what ways may the government determine the value of the monetary standard?
21. If all the different denominations of media of exchange were doubled in number, exchanges remaining unchanged, what would be the effect upon prices?
22. Is it true of all commodities that changes in supply affect their value proportionally? Is it true of money? If in your opinion there is any difference, explain it.
23. If the amount of coal in a country should be increased twenty-five per cent., in what percentage would you expect the value of coal to change? Give reasons. If the amount of money in a country should be increased twenty-five per cent., in what direction and in what percentage would the value of money change? Give reasons. (In each case the condition is "other things being equal.")
24. If in a given community all watch cases were made of gold, and each case contained one ounce of gold, would you expect the value of watch cases to fall by exactly one-half if the number of watch cases in the community were doubled, all other things remaining the same? If in another community (at another time) all exchanges were made exclusively by the use of gold coins, each containing an ounce of pure gold, would you expect that prices in general would be exactly doubled in case no change occurred in the community except a doubling of the number of coins in circulation?
25. Why might an increased resort to barter produce upon the general level of money prices effects similar to those produced by an increased use of credit media of exchange?
26. What gives rise to the belief sometimes held that money is an invariable standard of value?
27. Define depreciation and appreciation of the currency. What causes may produce either? What are the effects of either? More generally, what determines the value of the currency?
28. If gold were to become as plentiful as iron, would it be worth more or less than iron?
29. A nation having no foreign trade had originally in circulation 1,000,000 coins, each called a florin, and each containing an ounce of pure metal. To this original coin circulation the government adds 500,000 florins each containing one-half ounce of pure metal, and at the same time the government adds to the circulation 600,000 florins in the shape of inconvertible paper. Both the half ounce florin and the paper florin are by law made legal tender for a full weight florin. In the absence of any tendency to discriminate between accepting different kinds of florins in domestic trade, and with no other changes in the money situation except such as are necessitated by the aforesaid additions to the circulating medium, tell, first, what ultimately will be the number of florins in circulation, and give your reasons; and tell, second, of what kinds of florins and in what proportions the ultimate circulating medium will be composed.