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. 30. Assume a country using gold alone as money and having in circulation 2,000,000 coins, under a system of free coinage. What would be the effect of closing the mints and issuing 1,500,000 new coins containing nine-tenths as much gold as the coins above mentioned, assuming that the number of goods exchanged remains the same? Explain clearly. What is the total quantity of such new coins the government can issue and keep in circulation? Explain clearly. 31. A country using gold money as its sole medium of exchange, under free and gratuitous coinage, makes the following change: it imposes a seigniorage charge of ten per cent., but without giving up free coinage or reducing the amount of fine gold in the coin. To what extent and in what direction will the value of money change, if at all (a) if the number of goods exchanged gradually increases five percent.; (b) if the number of goods exchanged gradually increases twenty-five percent.? Give your reasons clearly. CHAPTER 5 FIDUCIARY MONEY, METAL AND PAPER REFERENCES. *_Jevons_, chs. VIII, XVII, XVIII. *_Johnson_, chs. XIII-XVI. _Kemmerer, E. W._, Modern currency reforms. 1916. *_Phillips_, chs. IV, V, XII. _United States Director of the Mint_, Annual reports. _Walker_, chs. VIII-XII. _White_, Bk. II, chs. III-VI. QUESTIONS.