Practice these TOEFL iBT listening tests to help you score high in the TOEFL Listening Section. Check the correct answers and audio transcripts below. This video is in the series of NEW TOEFL iBT Tests 2015.
Male Professor: Since yesterday’s brief introduction on the origin of banking confused some of you, today I would like to review it a little bit. Banking the way we know it today is a convenience. The money used in banking represents a certain amount of value, but the money itself isn’t valuable; it’s just paper. To see how we got here...suppose we think about a society far, far back in history—what would it have used before the paper money we have today?
Female Student: Didn’t they trade with the goods themselves?
MP: Sure. The system of exchanging one good for another of equal value is called bartering. Bartering was common in early societies, first with essential goods, then with nonessential goods. By nonessential, I mean, for example, art or cultural objects. You might trade a curtain that had been dyed in a decorative pattern for some wheat. The curtain’s decorative value isn’t essential to survival the way the food value of the grain is. That’s the first step toward a money economy: Recognizing trade-worthy value in something that isn’t essential to survival.
Of course, you may see a hitch. Different cultures don’t value the same decorations, so something could be worth a lot to one tribe and nothing to another. With food, that’s not a problem—everyone has to eat—but with nonessential items, you’re going to use something with cross-cultural value. Can anyone think of anything that would work?
Male Student: How about gold? It’s durable...easy to shape...and it’s beautiful. Is that why cultures started using it as money?
MP: Well, you can’t refer to the earliest trade with gold as a money economy, but yes.
Gold is a perfect example. As societies grew more stable and trade flourished, gold, usually molded into small ingots, gradually replaced the system of bartering. There were problems with gold, though.
FS: Yeah, I was going to say, gold is heavy, isn’t it? How did people carry enough of it around to buy things? And wasn’t it dangerous—like, you’d get robbed if people knew you had money with you?
MP: Definitely. Hauling all your gold around was a real risk in early societies, when there were bandits roaming around and no police to help you. And as you say, gold is heavy and unwieldy. One advantage it has, though, is that, unlike livestock or food, it doesn’t go bad, so you don’t have to use it up immediately.
That combination of characteristics gave people an idea. They started leaving their gold ingots with gold specialists for safekeeping. The specialists stored the gold for a small fee, and they gave their customers receipts, the way you’d get today. So you’d get something that said that, you know, you were the owner of such-and-such an amount of gold stored at this particular shop. The quality of gold from different mines varies, so the purity and density of your gold ingots—you know, how heavy they were for their size—determined their value and would also be recorded.
Then, when you wanted to use it, you just went back, gave the shopkeeper the receipt, and he gave you your gold.
MS: So if you were storing 500 ounces of gold of whatever percent purity, you’d give the receipt back, and get your 500 ounces of gold back? They kept it for you in your own little drawer or something?
MP: Whoops! I guess I did make it sound that way—thanks for catching that! No, you’d get 500 ounces of gold of the same purity back. They would have equal value, but would not necessarily be the exact same pile of ingots that you originally gave to the shopkeeper.
FS: The shopkeeper would use the gold or lend it out while you were storing it?
MP: Sure, and you can see how that’s another of the beginnings of banking as we know it. You wouldn’t get back your very own pile of gold; you’d get back a pile of equal value. It was the value itself that was important.
MS: So how did it become like money? I mean, we’re still talking about big, heavy stacks of things, and—
MP: Well, that’s the last point. Eventually, people figured out that they could use their receipts from storing gold to trade with one another. If they wanted to buy something, instead of running to the gold shop, withdrawing gold, and bringing it to another shop to pay for food or clay pots or whatever, they just gave the food merchant a receipt for the appropriate amount of gold. The merchant could then cash it in for gold, and
the trade would be complete. And that’s the last major step: The receipts became the first real ancestor of the money we use today because they stood for value actually attached to goods somewhere else.
Correct Answers:
1. C
2. B,D,E
3. B
4. B
5. C
6. A
