Question 1

With the emergence of specialization, ____ was necessary.

Accepted Answer

A)  exchange 
B)  production 
C)  labor 
D)  self-sufficiency 
E)  fiat money 
A)  exchange 
B)  production 
C)  labor 
D)  self-sufficiency 
E)  fiat money

Question 2

Which of the following statements is true of a barter system?

Accepted Answer

A)  In a barter system, it is difficult to keep track of the relative values of goods and services. 
B)  In a barter system, an individual offers money to import goods and services. 
C)  In a barter system, an individual offers currency notes to get coins. 
D)  In a barter system, different kinds of money are exchanged for one another. 
E)  In a barter system, individuals are self-sufficient. 
A)  In a barter system, it is difficult to keep track of the relative values of goods and services. 
B)  In a barter system, an individual offers money to import goods and services. 
C)  In a barter system, an individual offers currency notes to get coins. 
D)  In a barter system, different kinds of money are exchanged for one another. 
E)  In a barter system, individuals are self-sufficient.

Question 3

One characteristic of cattle that makes them unsuitable as a medium of exchange is that they are not easily divisible.

Accepted Answer

A) True 
 B)False

Question 4

Who could get a home mortgage prior to 2000?

Accepted Answer

A)  a prime borrower 
B)  a subprime borrower 
C)  a person who was a poor credit risk 
D)  a person who did not have a stable stream of income 
E)  a person who do not have sufficient collateral 
A)  a prime borrower 
B)  a subprime borrower 
C)  a person who was a poor credit risk 
D)  a person who did not have a stable stream of income 
E)  a person who do not have sufficient collateral

Question 5

Coins are minted with serrated edges _____

Accepted Answer

A)  to make it obvious that they are made of cheap alloys. 
B)  so that cheaper metals do not have to be used. 
C)  to allow words to be printed on the border. 
D)  to prevent the coins from being clipped. 
E)  to make them jingle less when they are rubbed together. 
A)  to make it obvious that they are made of cheap alloys. 
B)  so that cheaper metals do not have to be used. 
C)  to allow words to be printed on the border. 
D)  to prevent the coins from being clipped. 
E)  to make them jingle less when they are rubbed together.

Question 6

The Federal Reserve provides gold in exchange for Federal Reserve notes.

Accepted Answer

A) True 
 B)False

Question 7

If people use quartz as a medium of exchange, then they _____

Accepted Answer

A)  are in a barter economy. 
B)  are using commodity money. 
C)  are using token money. 
D)  are using legal tender. 
E)  are using fiat money. 
A)  are in a barter economy. 
B)  are using commodity money. 
C)  are using token money. 
D)  are using legal tender. 
E)  are using fiat money.

Question 8

State banks, like English goldsmiths, could _____

Accepted Answer

A)  raise money by issuing stock and lend the money to borrowers. 
B)  accumulate funds from borrowers and lend them to savers. 
C)  borrow funds from the government and lend them to borrowers. 
D)  borrow funds from the government and lend them to savers. 
E)  issue banknotes. 
A)  raise money by issuing stock and lend the money to borrowers. 
B)  accumulate funds from borrowers and lend them to savers. 
C)  borrow funds from the government and lend them to borrowers. 
D)  borrow funds from the government and lend them to savers. 
E)  issue banknotes.

Question 9

Which bank ranks first in assets among U.S. banks as of 2016?

Accepted Answer

A)  JPMorgan Chase 
B)  Wells Fargo 
C)  Bank of America 
D)  BB&T 
E)  Wachovia 
A)  JPMorgan Chase 
B)  Wells Fargo 
C)  Bank of America 
D)  BB&T 
E)  Wachovia

Question 10

The Board of Governors of the Fed consists of _____

Accepted Answer

A)  seven elected members. 
B)  seven members appointed by the president. 
C)  a representative from each of the 12 district banks. 
D)  12 elected members. 
E)  12 members appointed by the president. 
A)  seven elected members. 
B)  seven members appointed by the president. 
C)  a representative from each of the 12 district banks. 
D)  12 elected members. 
E)  12 members appointed by the president.

Question 11

A claim on the monthly payments made on bundled mortgages is called a(n) _____

Accepted Answer

A)  TARP 
B)  mortgage-backed security 
C)  adjustable-rate mortgage 
D)  negotiable CD 
E)  discount bond 
A)  TARP 
B)  mortgage-backed security 
C)  adjustable-rate mortgage 
D)  negotiable CD 
E)  discount bond

Question 12

Inflation is impossible in a commodity money system.

Accepted Answer

A) True 
 B)False

Question 13

Identify the statement that is true of a barter system.

Accepted Answer

A)  In a barter system, trade will only occur if there is a double coincidence of wants. 
B)  In a barter system, an individual offers coins to get a good or service. 
C)  In a barter system, an individual offers commodity money to get fiat money. 
D)  In a barter system, different kinds of money are exchanged for one another. 
E)  In a barter system, individuals are self-sufficient. 
A)  In a barter system, trade will only occur if there is a double coincidence of wants. 
B)  In a barter system, an individual offers coins to get a good or service. 
C)  In a barter system, an individual offers commodity money to get fiat money. 
D)  In a barter system, different kinds of money are exchanged for one another. 
E)  In a barter system, individuals are self-sufficient.

Question 14

Paper money is a good example of commodity money.

Accepted Answer

A) True 
 B)False

Question 15

Whatever functions as money must be _____

Accepted Answer

A)  varied in quality. 
B)  accepted as deposit by banks. 
C)  backed by precious metals like gold or silver. 
D)  completely indestructible. 
E)  limited in supply. 
A)  varied in quality. 
B)  accepted as deposit by banks. 
C)  backed by precious metals like gold or silver. 
D)  completely indestructible. 
E)  limited in supply.

Question 16

Which of the following statements is true?

Accepted Answer

A)  The Federal Reserve System was established by the U.S. Constitution. 
B)  The Federal Reserve System was established immediately after the Civil War. 
C)  The Federal Reserve System was established in 1913. 
D)  The Federal Reserve System was established during the Great Depression. 
E)  The Federal Reserve System was established immediately following World War II. 
A)  The Federal Reserve System was established by the U.S. Constitution. 
B)  The Federal Reserve System was established immediately after the Civil War. 
C)  The Federal Reserve System was established in 1913. 
D)  The Federal Reserve System was established during the Great Depression. 
E)  The Federal Reserve System was established immediately following World War II.

Question 17

Each member of the Board of Governors of the Fed _____

Accepted Answer

A)  is from the minority of the FOMC. 
B)  can have twelve presidential appointments. 
C)  is authorized to set reserve requirements by the Bank Acts of 1933 and 1935. 
D)  serves one nonrenewable term. 
E)  is elected by the member banks that own the Federal Reserve. 
A)  is from the minority of the FOMC. 
B)  can have twelve presidential appointments. 
C)  is authorized to set reserve requirements by the Bank Acts of 1933 and 1935. 
D)  serves one nonrenewable term. 
E)  is elected by the member banks that own the Federal Reserve.

Question 18

Token money is _____

Accepted Answer

A)  money whose face value exceeds its production cost. 
B)  money whose face value is less than its production cost. 
C)  anything that loses its purchasing power over time. 
D)  money that has no value. 
E)  money that is redeemable for any commodity. 
A)  money whose face value exceeds its production cost. 
B)  money whose face value is less than its production cost. 
C)  anything that loses its purchasing power over time. 
D)  money that has no value. 
E)  money that is redeemable for any commodity.

Question 19

The greater the number of different goods available in an economy, the _____

Accepted Answer

A)  less likely it is that a double coincidence of wants will exist, and the less likely it is that monetary exchange will develop. 
B)  less likely it is that a double coincidence of wants will exist, and the more likely it is that monetary exchange will develop. 
C)  more likely it is that a double coincidence of wants will exist, and the less likely it is that monetary exchange will develop. 
D)  more likely it is that a double coincidence of wants will exist, and the more likely it is that monetary exchange will develop. 
E)  more likely it is that individuals are producing only goods they want to consume. 
A)  less likely it is that a double coincidence of wants will exist, and the less likely it is that monetary exchange will develop. 
B)  less likely it is that a double coincidence of wants will exist, and the more likely it is that monetary exchange will develop. 
C)  more likely it is that a double coincidence of wants will exist, and the less likely it is that monetary exchange will develop. 
D)  more likely it is that a double coincidence of wants will exist, and the more likely it is that monetary exchange will develop. 
E)  more likely it is that individuals are producing only goods they want to consume.

Question 20

Which of the following statements is true of open-market operations?

Accepted Answer

A)  Open-market operations involve clearing checks. 
B)  Open-market operations involve lending money to member banks. 
C)  Open-market operations involve accepting deposits from member banks. 
D)  Open-market operations involve the Fed's purchase and sale of government securities. 
E)  Open-market operations involve the Fed's purchase and sale of foreign exchange. 
A)  Open-market operations involve clearing checks. 
B)  Open-market operations involve lending money to member banks. 
C)  Open-market operations involve accepting deposits from member banks. 
D)  Open-market operations involve the Fed's purchase and sale of government securities. 
E)  Open-market operations involve the Fed's purchase and sale of foreign exchange.

With the emergence of specialization, ____ was necessary.

Which of the following statements is true of a barter system?

One characteristic of cattle that makes them unsuitable as a medium of exchange is that they are not easily divisible.

Who could get a home mortgage prior to 2000?

Coins are minted with serrated edges _____

The Federal Reserve provides gold in exchange for Federal Reserve notes.

If people use quartz as a medium of exchange, then they _____

State banks, like English goldsmiths, could _____

Which bank ranks first in assets among U.S. banks as of 2016?

The Board of Governors of the Fed consists of _____

A claim on the monthly payments made on bundled mortgages is called a(n) _____

Inflation is impossible in a commodity money system.

Identify the statement that is true of a barter system.

Paper money is a good example of commodity money.

Whatever functions as money must be _____

Which of the following statements is true?

Each member of the Board of Governors of the Fed _____

Token money is _____

The greater the number of different goods available in an economy, the _____

Which of the following statements is true of open-market operations?

The Art and Science of Economic Analysis.

Economic Tools and Economic Systems.

Economic Decision Makers.

Demand, Supply, and Markets.

Introduction to Macroeconomics.

Tracking the U. S. Economy.

Unemployment and Inflation.

Productivity and Growth.

Aggregate Demand.

Aggregate Supply.

Fiscal Policy.

Federal Budgets and Public Policy.

Banking and the Money Supply.

Monetary Theory and Policy.

Macro Policy Debate: Active or Passive?

International Trade.

International Finance.

Economic Development.

Filters

Exam 13: Money and the Financial System.

With the emergence of specialization, ____ was necessary.

Which of the following statements is true of a barter system?

One characteristic of cattle that makes them unsuitable as a medium of exchange is that they are not easily divisible.

Who could get a home mortgage prior to 2000?

Coins are minted with serrated edges _____

The Federal Reserve provides gold in exchange for Federal Reserve notes.

If people use quartz as a medium of exchange, then they _____

State banks, like English goldsmiths, could _____

Which bank ranks first in assets among U.S. banks as of 2016?

The Board of Governors of the Fed consists of _____

A claim on the monthly payments made on bundled mortgages is called a(n) _____

Inflation is impossible in a commodity money system.

Identify the statement that is true of a barter system.

Paper money is a good example of commodity money.

Whatever functions as money must be _____

Which of the following statements is true?

Each member of the Board of Governors of the Fed _____

Token money is _____

The greater the number of different goods available in an economy, the _____

Which of the following statements is true of open-market operations?

The Art and Science of Economic Analysis.

Economic Tools and Economic Systems.

Economic Decision Makers.

Demand, Supply, and Markets.

Introduction to Macroeconomics.

Tracking the U. S. Economy.

Unemployment and Inflation.

Productivity and Growth.

Aggregate Demand.

Aggregate Supply.

Fiscal Policy.

Federal Budgets and Public Policy.

Banking and the Money Supply.

Monetary Theory and Policy.

Macro Policy Debate: Active or Passive?

International Trade.

International Finance.

Economic Development.

Filters