Question 1

Why is a checking account also referred to as a demand deposit?

Accepted Answer

Checking accounts,known as dem

Question 2

The economy is slowing down and unemployment is high.Which of the following is the Fed most likely to do?

Accepted Answer

A)  print more money 
B)  raise the discount rate 
C)  increase the reserve requirement 
D)  buy government securities 
A)  print more money 
B)  raise the discount rate 
C)  increase the reserve requirement 
D)  buy government securities

Question 3

Which of the following is the least expensive?

Accepted Answer

A)  to issue a check payment 
B)  to borrow from a bank 
C)  to issue an electronic funds transfer (ETF) payment 
D)  to obtain a cash advance on a credit card 
A)  to issue a check payment 
B)  to borrow from a bank 
C)  to issue an electronic funds transfer (ETF) payment 
D)  to obtain a cash advance on a credit card

Question 4

The prime rate is the interest rate available to a bank's most creditworthy customers.

Accepted Answer

A) True 
 B)False

Question 5

The Federal Deposit Insurance Corporation (FDIC)insures,through its Bank Insurance Fund (BIF),the accounts of depositors in its member banks.How much protection does the BIF provide?

Accepted Answer

At the present time,an account

Question 6

The federal agency that guarantees the safety of bank deposits is the ________.

Accepted Answer

A)  IRA 
B)  ATM 
C)  ETF 
D)  FDIC 
A)  IRA 
B)  ATM 
C)  ETF 
D)  FDIC

Question 7

A decrease in the reserve requirement will result in a reduction in the money supply.

Accepted Answer

A) True 
 B)False

Question 8

Identify three important ways in which the money and banking system is changing.

Accepted Answer

Answers will vary.In the area of anti-cr

Question 9

Modern currency is light and easy to handle,thus meeting the criteria for ________.

Accepted Answer

A)  portability 
B)  divisibility 
C)  stability 
D)  durability 
A)  portability 
B)  divisibility 
C)  stability 
D)  durability

Question 10

The ________ is the percentage of its deposits a bank must hold,in cash or on deposit,with a Federal Reserve bank.

Accepted Answer

A)  discount rate 
B)  reserve requirement 
C)  open-market rate 
D)  prime rate 
A)  discount rate 
B)  reserve requirement 
C)  open-market rate 
D)  prime rate

Question 11

Short Case Scenario 15-1
John Smith, a Minnesota native, has recently been elected to the U.S. House of Representatives. John, a long-time college professor, was elected on a platform of educational reform. Somehow, John finds himself appointed to the Joint Economic and Financial Services Committees. John is having a hard time understanding the testimony before each committee, but is hesitant to ask too many questions.
-After a long day,John goes home and tries to relax by watching television.All of the news shows are reporting protests against the IMF.Help John understand the functions of the International Monetary Fund (IMF).

Accepted Answer

The International Monetary Fund (IMF)is

Question 12

Every month,Bill adds to a savings account with a financial institution that makes loans for homes.The only money he makes from this institution is interest on his savings.The financial institution is most likely a ________.

Accepted Answer

A)  commercial bank 
B)  finance company 
C)  savings and loan association 
D)  mutual savings bank 
A)  commercial bank 
B)  finance company 
C)  savings and loan association 
D)  mutual savings bank

Question 13

Insurance companies are nondeposit financial institutions.

Accepted Answer

A) True 
 B)False

Question 14

Insurance companies accumulate money from premiums charged for coverage.What do their investment earnings pay for?

Accepted Answer

Their investment earnings pay

Question 15

Alice has turned to a credit union for all of her financial service needs.What is the purpose of a credit union?

Accepted Answer

A)  to promote thrift 
B)  to provide a safe place to save at reasonable rates 
C)  to provide a safe place to borrow at reasonable rates 
D)  All of these are purposes of credit unions. 
A)  to promote thrift 
B)  to provide a safe place to save at reasonable rates 
C)  to provide a safe place to borrow at reasonable rates 
D)  All of these are purposes of credit unions.

Question 16

How has the banking industry responded to the mortgage crisis?

Accepted Answer

As a result of the mortgage crisis,the b

Question 17

When buying from a Polish supplier,a ________ may be used.It is a promise by a bank to pay the Polish firm a certain amount if specified conditions are met.

Accepted Answer

A)  banker's acceptance 
B)  transfer form 
C)  letter of credit 
D)  bill of lading 
A)  banker's acceptance 
B)  transfer form 
C)  letter of credit 
D)  bill of lading

Question 18

The Federal Reserve consists of seven banking districts.

Accepted Answer

A) True 
 B)False

Question 19

The World Bank is a United Nations agency that provides a limited scope of financial services such as funding national improvements in underdeveloped countries.

Accepted Answer

A) True 
 B)False

Question 20

When transactions are made among buyers and sellers in different countries,payments are simplified through the services provided by ________.

Accepted Answer

A)  the U.S. State Department 
B)  American consulates on the scene 
C)  banks 
D)  the Internet 
A)  the U.S. State Department 
B)  American consulates on the scene 
C)  banks 
D)  the Internet

Why is a checking account also referred to as a demand deposit?

The economy is slowing down and unemployment is high.Which of the following is the Fed most likely to do?

Which of the following is the least expensive?

The prime rate is the interest rate available to a bank's most creditworthy customers.

The Federal Deposit Insurance Corporation (FDIC)insures,through its Bank Insurance Fund (BIF),the accounts of depositors in its member banks.How much protection does the BIF provide?

The federal agency that guarantees the safety of bank deposits is the ________.

A decrease in the reserve requirement will result in a reduction in the money supply.

Identify three important ways in which the money and banking system is changing.

Modern currency is light and easy to handle,thus meeting the criteria for ________.

The ________ is the percentage of its deposits a bank must hold,in cash or on deposit,with a Federal Reserve bank.

Every month,Bill adds to a savings account with a financial institution that makes loans for homes.The only money he makes from this institution is interest on his savings.The financial institution is most likely a ________.

Insurance companies are nondeposit financial institutions.

Insurance companies accumulate money from premiums charged for coverage.What do their investment earnings pay for?

Alice has turned to a credit union for all of her financial service needs.What is the purpose of a credit union?

How has the banking industry responded to the mortgage crisis?

When buying from a Polish supplier,a ________ may be used.It is a promise by a bank to pay the Polish firm a certain amount if specified conditions are met.

The Federal Reserve consists of seven banking districts.

The World Bank is a United Nations agency that provides a limited scope of financial services such as funding national improvements in underdeveloped countries.

When transactions are made among buyers and sellers in different countries,payments are simplified through the services provided by ________.

The U.S.Business Environment

Business Ethics and Social Responsibility

Entrepreneurship, New Ventures, and Business Ownership

The Global Context of Business

Business Management

Organizing the Business

Operations Management and Quality

Employee Behavior and Motivation

Leadership and Decision Making

Human Resource Management and Labor Relations

Marketing Processes and Consumer Behavior

Pricing, Distributing, and Promoting Products

The Role of Accountants and Accounting Information

Managing Finances

Filters

Exam 15: Money and Banking

Why is a checking account also referred to as a demand deposit?

The economy is slowing down and unemployment is high.Which of the following is the Fed most likely to do?

Which of the following is the least expensive?

The prime rate is the interest rate available to a bank's most creditworthy customers.

The Federal Deposit Insurance Corporation (FDIC)insures,through its Bank Insurance Fund (BIF),the accounts of depositors in its member banks.How much protection does the BIF provide?

The federal agency that guarantees the safety of bank deposits is the ________.

A decrease in the reserve requirement will result in a reduction in the money supply.

Identify three important ways in which the money and banking system is changing.

Modern currency is light and easy to handle,thus meeting the criteria for ________.

The ________ is the percentage of its deposits a bank must hold,in cash or on deposit,with a Federal Reserve bank.

Every month,Bill adds to a savings account with a financial institution that makes loans for homes.The only money he makes from this institution is interest on his savings.The financial institution is most likely a ________.

Insurance companies are nondeposit financial institutions.

Insurance companies accumulate money from premiums charged for coverage.What do their investment earnings pay for?

Alice has turned to a credit union for all of her financial service needs.What is the purpose of a credit union?

How has the banking industry responded to the mortgage crisis?

When buying from a Polish supplier,a ________ may be used.It is a promise by a bank to pay the Polish firm a certain amount if specified conditions are met.

The Federal Reserve consists of seven banking districts.

The World Bank is a United Nations agency that provides a limited scope of financial services such as funding national improvements in underdeveloped countries.

When transactions are made among buyers and sellers in different countries,payments are simplified through the services provided by ________.

The U.S.Business Environment

Business Ethics and Social Responsibility

Entrepreneurship, New Ventures, and Business Ownership

The Global Context of Business

Business Management

Organizing the Business

Operations Management and Quality

Employee Behavior and Motivation

Leadership and Decision Making

Human Resource Management and Labor Relations

Marketing Processes and Consumer Behavior

Pricing, Distributing, and Promoting Products

The Role of Accountants and Accounting Information

Managing Finances

Filters