Question 1

The faster the rate of circulation of the money supply,the greater the output of goods and services in an economy.

Accepted Answer

A) True 
 B)False

Question 2

Primitive economies have little occasion to exchange goods or services.

Accepted Answer

A) True 
 B)False

Question 3

Currently,the international monetary system can best be described as a managed pegged exchange rate system.

Accepted Answer

A) True 
 B)False

Question 4

____________ include the direct ownership of land,buildings or homes,equipment,inventories,durable goods,and even precious metals.

Accepted Answer

A) financial assets 
B) real assets 
C) government investments 
D) all of the above 
E) none of the above 
A) financial assets 
B) real assets 
C) government investments 
D) all of the above 
E) none of the above

Question 5

Inflation reflects a rise in prices not offset by increases in quality.

Accepted Answer

A) True 
 B)False

Question 6

A major factor in the severity of the 2007-09 financial crisis was the massive amounts of debt taken on by:

Accepted Answer

A) individuals 
B) business 
C) government 
D) all of the above 
E) none of the above 
A) individuals 
B) business 
C) government 
D) all of the above 
E) none of the above

Question 7

A major objective of the Fed is to regulate and control the supply of money and the availability of credit.

Accepted Answer

A) True 
 B)False

Question 8

One reason the Fed defines so many measures of money is that economists have different opinions as to which measure is most consistently related to spending and other economic activity.

Accepted Answer

A) True 
 B)False

Question 9

The M1 definition of the money supply includes which of the following items?

Accepted Answer

A) currency 
B) demand deposits and other checkable deposits at depository institutions 
C) travelers' checks 
D) all of the above 
A) currency 
B) demand deposits and other checkable deposits at depository institutions 
C) travelers' checks 
D) all of the above

Question 10

M1 money supply consists of currency,travelers' checks,demand deposits,and other checkable deposits.

Accepted Answer

A) True 
 B)False

Question 11

The supply of a currency in international markets depends largely on the:

Accepted Answer

A) Federal Reserve System 
B) imports of the issuing country 
C) amount of exports that currency will buy from the issuing country 
D) confidence of market participants in the restraint and ability of the monetary authority issuing the currency 
A) Federal Reserve System 
B) imports of the issuing country 
C) amount of exports that currency will buy from the issuing country 
D) confidence of market participants in the restraint and ability of the monetary authority issuing the currency

Question 12

"Continentals" were denominated in dollars and were backed by gold.

Accepted Answer

A) True 
 B)False

Question 13

M3 money supply includes M2 plus large time deposits and institutional MMMFs,repurchase agreements,and Eurodollar deposits.

Accepted Answer

A) True 
 B)False

Question 14

Fiat money is paper money fully backed by a precious metal such as gold.

Accepted Answer

A) True 
 B)False

Question 15

Money is anything generally accepted as a means of paying for goods and services and for paying off debts.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following is not a component of the M1 definition of the money supply?

Accepted Answer

A) travelers' checks 
B) savings and small time deposits at depository institutions 
C) currency held by the non-bank public 
D) demand deposits at depository institutions 
A) travelers' checks 
B) savings and small time deposits at depository institutions 
C) currency held by the non-bank public 
D) demand deposits at depository institutions

Question 17

Which of the following are not depository institutions?

Accepted Answer

A) The Federal Reserve 
B) credit unions 
C) savings banks 
D) commercial banks 
A) The Federal Reserve 
B) credit unions 
C) savings banks 
D) commercial banks

Question 18

Full-bodied money is a monetary standard based on two metals,usually silver and gold.

Accepted Answer

A) True 
 B)False

Question 19

An increase in the general overall prices of goods and services that is not offset by increases in the quality of those goods and services is the definition for:

Accepted Answer

A) liquidity 
B) inflation 
C) full-bodied goods and services 
D) store of purchasing power 
A) liquidity 
B) inflation 
C) full-bodied goods and services 
D) store of purchasing power

Question 20

If the money supply for an economy is $3 trillion and the velocity of money is 4.5,then GDP is:

Accepted Answer

A) $0.67 trillion 
B) $1.5 trillion 
C) $7.5 trillion 
D) $13.5 trillion 
A) $0.67 trillion 
B) $1.5 trillion 
C) $7.5 trillion 
D) $13.5 trillion

The faster the rate of circulation of the money supply,the greater the output of goods and services in an economy.

Primitive economies have little occasion to exchange goods or services.

Currently,the international monetary system can best be described as a managed pegged exchange rate system.

____________ include the direct ownership of land,buildings or homes,equipment,inventories,durable goods,and even precious metals.

Inflation reflects a rise in prices not offset by increases in quality.

A major factor in the severity of the 2007-09 financial crisis was the massive amounts of debt taken on by:

A major objective of the Fed is to regulate and control the supply of money and the availability of credit.

One reason the Fed defines so many measures of money is that economists have different opinions as to which measure is most consistently related to spending and other economic activity.

The M1 definition of the money supply includes which of the following items?

M1 money supply consists of currency,travelers' checks,demand deposits,and other checkable deposits.

The supply of a currency in international markets depends largely on the:

"Continentals" were denominated in dollars and were backed by gold.

M3 money supply includes M2 plus large time deposits and institutional MMMFs,repurchase agreements,and Eurodollar deposits.

Fiat money is paper money fully backed by a precious metal such as gold.

Money is anything generally accepted as a means of paying for goods and services and for paying off debts.

Which of the following is not a component of the M1 definition of the money supply?

Which of the following are not depository institutions?

Full-bodied money is a monetary standard based on two metals,usually silver and gold.

An increase in the general overall prices of goods and services that is not offset by increases in the quality of those goods and services is the definition for:

If the money supply for an economy is $3 trillion and the velocity of money is 4.5,then GDP is:

The Financial Environment

Banks and Other Financial Institutions

Federal Reserve System

Policy Makers and the Money Supply

International Finance and Trade

Savings and Investment Process

Interest Rates

Time Value of Money

Bonds and Stocks: Characteristics and Valuation

Securities Markets

Financial Return and Risk Concepts

Business Organization and Financial Data

Financial Analysis and Long-Term Financial Planning

Managing Working Capital

Short-Term Business Financing

Capital Budgeting Analysis

Capital Structure and the Cost of Capital

Filters

Exam 2: Money and the Monetary System

The faster the rate of circulation of the money supply,the greater the output of goods and services in an economy.

Primitive economies have little occasion to exchange goods or services.

Currently,the international monetary system can best be described as a managed pegged exchange rate system.

____________ include the direct ownership of land,buildings or homes,equipment,inventories,durable goods,and even precious metals.

Inflation reflects a rise in prices not offset by increases in quality.

A major factor in the severity of the 2007-09 financial crisis was the massive amounts of debt taken on by:

A major objective of the Fed is to regulate and control the supply of money and the availability of credit.

One reason the Fed defines so many measures of money is that economists have different opinions as to which measure is most consistently related to spending and other economic activity.

The M1 definition of the money supply includes which of the following items?

M1 money supply consists of currency,travelers' checks,demand deposits,and other checkable deposits.

The supply of a currency in international markets depends largely on the:

"Continentals" were denominated in dollars and were backed by gold.

M3 money supply includes M2 plus large time deposits and institutional MMMFs,repurchase agreements,and Eurodollar deposits.

Fiat money is paper money fully backed by a precious metal such as gold.

Money is anything generally accepted as a means of paying for goods and services and for paying off debts.

Which of the following is not a component of the M1 definition of the money supply?

Which of the following are not depository institutions?

Full-bodied money is a monetary standard based on two metals,usually silver and gold.

An increase in the general overall prices of goods and services that is not offset by increases in the quality of those goods and services is the definition for:

If the money supply for an economy is $3 trillion and the velocity of money is 4.5,then GDP is:

The Financial Environment

Banks and Other Financial Institutions

Federal Reserve System

Policy Makers and the Money Supply

International Finance and Trade

Savings and Investment Process

Interest Rates

Time Value of Money

Bonds and Stocks: Characteristics and Valuation

Securities Markets

Financial Return and Risk Concepts

Business Organization and Financial Data

Financial Analysis and Long-Term Financial Planning

Managing Working Capital

Short-Term Business Financing

Capital Budgeting Analysis

Capital Structure and the Cost of Capital

Filters