eco4223 week 3 quiz 2017
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Question 1
Bank capital is equal to
a.the value of the capital originally invested in the bank by its owners.
b.the value of everything the bank owns.
c.the difference between the value of the bank's assets and the value of its liabilities.
d.the value of the buildings and other physical assets the bank owns.
5 points Saved
Question 2
Which of the following things do banks do with the funds they acquire from savers?
a.invest in corporate stock
b.invest in corporate bonds
c.make loans to individuals
d.all of the above
5 points Saved
Question 3
Short-term loans between banks are called
a.federal funds.
b.repurchase agreements.
c.repos.
d.discount loans.
5 points Saved
Question 4
Collateral XX
a.XXX interest XXXX XXXX banks charge XXXX-quality XXXXXXXXX.
b.XXXXXX XXXXXXX to XXX bank in the XXXXX the XXXXXXXX defaults.
c.XXX XXXXXXXXXX XXXXXXX the value XX a XXXX's XXXXXX and XXX value of a bank's liabilities.
d.XXXXXXXX XXXXXXXX XXXXX excess reserves.
5 points Saved
Question X
XXXX borrowing XXXX XXX Fed is referred to as:
a.federal funds
b.discount loans
c.XXXXXXXXXX agreements
d.reverse XXXXXXXXXX XXXXXXXXXX
X points Saved
XXXXXXXX X
XXXXXXXX created the XXXXXXX Reserve XXXXXX
a.XX serve XX a XXXXXX XX XXXX resort
b.to XXXXXXX the XXXXXXX XX taxes received XX XXX Internal Revenue Service.
c.XX XXXXXXXX the XXXXX XX XXX X.S. dollar against XXXXXXX XXXXXXXXXX.
d.XX XXXXXXX a XXXXXX XX mortgage loans XX XXX residential housing market.
X points XXXXX
XXXXXXXX 7
XXX original XXXXXXXXX of XXX Fed's XXXX as lender XX last XXXXXX XXX XX make XXXXX XX banks that were
a.XXX illiquid nor XXXXXXXXX.
b.XXXXXXXX, but not XXXXXXXXX.
c.XXXXXXXXX, but not XXXXXXXX.
d.XXXX illiquid XXX insolvent.
X XXXXXX XXXXX
Question X
XXX XXXXX a nation seek XX XXXXXXXX a pegged XXXXXXXX XXXX?
a.It makes XXXXXXXX planning easier XXX XXXXX involved in XXX XXXXXX XXXXXXX.
b.XX removes the need XX XXXXXXXXX in the XXXXXXX exchange XXXXXX.
c.XX XXXXXXX that XXX XXXXXXXX rate XXXX XXXXXX at its XXXXXXXXXXX.
d.XX makes their XXXXXXXX XXXX XXXXXXXXXX XX the XXXXXXX exchange market.
5 XXXXXX XXXXX
XXXXXXXX 9
XXXXXXXXX XXXX refers XX
a.debt XXXXX by XXX government.
b.bonds XXXXXX XX XXX XXXXXXXXXX.
c.XXXX XXXX XX XXX government.
d.debt only XXXXXX XX XXXXXXX XXXX kings or queens.
5 points Saved
Question XX
XXXX happened to XXXXXXXX prices as measured XX XXX CPI between 1929 XXX XXXX?
a.XXXX by more than XX%
b.didn't XXXXXX
c.declined XX XXXXX 25%
d.declined by about 80%
X points Saved
Question 11
XXXXX of XXX XXXXXXXXX is NOT considered one XX the XXXX groups in the Federal Reserve XXXXXX?
a.XXXXXXX XXXXXXX banks
b.Federal XXXXXXX Insurance XXXXXXXXXXX
c.XXXXX XX Governors
d.XXXXXXX XXXX Market XXXXXXXXX
5 points Saved
Question XX
Federal Reserve XXXXXXXX banks perform XXX of the following roles XXXXXX
a.managing checking XXXXXXXX in XXX XXXXXXXX XXXXXX.
b.performing regulatory functions.
c.setting the XXXXXXX funds XXXX.
d.managing XXXXXXXX in circulation by issuing XXX XXXXXXX XXXXXXX Notes.
5 XXXXXX Saved
Question 13
The Fed XXXX XXX XXXX to XX XXXXXXX XXX XXXXXX congressional appropriations process because
a.XXX expenses are very XXXXX.
b.it was given XXXXXX funds at XXX time of its XXXXXXXX XX XXXXXXX for its XXXXXXXX indefinitely.
c.it is XXXX financing.
d.it is XXX XXXX of XXX legislative branch XX XXX federal XXXXXXXXXX.
5 points Saved
Question 14
XXX XXXX argument in XXXXX of XXX independence XX that
a.interest XXXXX XXXXX probably XX XXXXX if XXXXXXXX XXXXXXXXXX XXX XXX; XXXX hurting XXXXXX.
b.the Constitution requires it.
c.XXXXXXXX XXXXXX is too XXXXXXXXX and XXX XXXXXXXXX to XX determined in XXX political arena.
d.congressional control XX the Fed XXX XXXXX XXXXXX the 1960s and XXX not work XXXX.
X points Saved
Question XX
Which of XXX following XX XXX most common goal XXX central banks XX industrialized XXXXXXXXX?
a.high XXXXXXXXXX
b.XXXX XXXXXXXX XXXXXX
c.low XXXXXXXX XXXXX
d.XXX XXXXXXXXX
X points Saved
XXXXXXXX 16
The XXXXXXXX base is XXXXX to
a.all XXXXXXXX in XXXXXXXXXXX XXXX XXX deposits in XXXXXXXXX XXXXXXXXXXXX.
b.XXX XXXXXXXX in XXXXXXXXXXX plus checkable deposits in financial institutions.
c.XXX XXXXXXXX in XXXXXXXXXXX plus XXXXXXXX held by XXXXX.
d.checkable XXXXXXXX in XXXXXXXXXX institutions XXXX reserves held XX XXXXX.
5 points XXXXX
XXXXXXXX XX
If the XXX purchases $XX,XXX in T-bills from a bank, XX how XXXX XXXX XXX bank's excess XXXXXXXX increase?
a.by $50,000
b.XX $50,XXX XXXXX the required XXXXXXX XXXXX
c.by $50,XXX XXXXXXX XX XXX required XXXXXXX XXXXX
d.Not XXXXXX information XXX XXXX provided XX XXXXXX the XXXXXXXX.
5 XXXXXX XXXXX
XXXXXXXX 18
What is the maximum XXXXXX a bank XXX XXXX?
a.XXX XXXXX XXXXXXXX
b.XXX excess XXXXXXXX
c.XXX XXXXXX XXXXXXXX XXXXXXX by XXX XXXXXXXX reserve XXXXX
d.the value XX its checkable deposits times XXX XXXXXXXX reserve ratio
5 points Saved
Question 19
If XXX Fed purchases $1 million worth of securities and the XXXXXXXX XXXXXXX XXXXX is X%, by how XXXX will deposits increase (assuming XX change in XXXXXX XXXXXXXX or the XXXXXX's currency holdings)?
a.rise XX $1 XXXXXXX
b.decline by $X million
c.XXXX by $X XXXXXXX
d.rise XX $XX.5 XXXXXXX
5 points Saved
Question XX
Suppose XXXX the XXXXXXX XXXXXX XXXXXXXX has no excess reserves and XXXX a bank XXXXXXXX a deposit XXXX a XXXXXXXX account XX $XX,000 in currency. If XXX required XXXXXXX XXXXX XX X.XX, XXXX XX XXX XXXXXXX amount that XXX XXXXXXX SYSTEM can lend out?
a.$8,XXX
b.$10,XXX
c.$40,000
d.$50,XXX
XXXXXX
X. the difference between the value XX the bank's XXXXXX and XXX value of XXX XXXXXXXXXXX.
2. make loans to XXXXXXXXXXX
X. federal XXXXX.
4. assets XXXXXXX to XXX XXXX in XXX event XXX borrower defaults.
X. XXXXXXXX XXXXX
6. to XXXXX XX a XXXXXX of XXXX resort
X. XXXXXXXX, but XXX insolvent.
8. XX XXXXX XXXXXXXX planning easier XXX firms XXXXXXXX in the XXXXXX economy.
9. bonds issued by XXX government.
XX. declined by about XX%
11. Federal XXXXXXX XXXXXXXXX Corporation
12. XXXXXXX the XXXXXXX XXXXX XXXX.
XX. it XX self XXXXXXXXX.
14. XXXXXXXX XXXXXX is XXX important and XXX XXXXXXXXX to be XXXXXXXXXX in the political arena.
XX. low inflation
16. all currency in circulation XXXX XXXXXXXX held XX XXXXX.
17. XX $XX,000
XX. its excess XXXXXXXX
XX. rise XX $12.X XXXXXXX
XX. $40,000
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