Exam 1: Why Study Money, banking, and Financial Markets

________ markets transfer funds from people who have an excess of available funds to people who have a shortage.

Budgets deficits can be a concern because they might

Everything else held constant,a decline in interest rates will cause spending on housing to

Financial markets promote economic efficiency by

Financial institutions search for ________ has resulted in many financial innovations.

The measure of the aggregate price level that is most frequently reported in the media is the

A key factor in producing high economic growth is

If the CPI in 2004 is 200,and in 2005 the CPI is 180,the rate of inflation from 2004 to 2005 is

American companies can borrow funds

Everything else held constant,an increase in interest rates on student loans

When tax revenues are greater than government expenditures,the government has a budget.

When I purchase a corporate ________,I am lending the corporation funds for a specific time.When I purchase a corporation's ________,I become an owner in the corporation.

Banks,savings and loan associations,mutual savings banks,and credit unions

The interest rate on Baa (medium quality)corporate bonds is ________,on average,than other interest rates,and the spread between it and other rates became ________ in the 1970s.

To convert a nominal GDP to a real GDP,you would use

Low stock market prices might ________ consumers willingness to spend and might ________ businesses willingness to undertake investment projects.

There is a ________ association between inflation and the growth rate of money ________.

GDP measured with constant prices is referred to as

Sustained downward movements in the business cycle are referred to as

During a recession,output declines resulting in