Question 1

The U.S.bimetallic standard was based on:

Accepted Answer

A) gold and platinum 
B) silver and gold 
C) gold and copper 
D) silver and copper 
A) gold and platinum 
B) silver and gold 
C) gold and copper 
D) silver and copper

Question 2

The three functions of money are:

Accepted Answer

A) medium of exchange,store of value,and measure of liquidity 
B) conduit for international trade,store of value,and standard of value 
C) medium of exchange,store of value,and standard of value 
D) inflation hedge,measure of liquidity,and medium of exchange 
A) medium of exchange,store of value,and measure of liquidity 
B) conduit for international trade,store of value,and standard of value 
C) medium of exchange,store of value,and standard of value 
D) inflation hedge,measure of liquidity,and medium of exchange

Question 3

When coins have an intrinsic value equal to the value of the metal they contain,they are?referred to as:

Accepted Answer

A) full-bodied money 
B) representative full-bodied money 
C) token coins 
D) all of the above 
A) full-bodied money 
B) representative full-bodied money 
C) token coins 
D) all of the above

Question 4

The only paper money of significance in the economy today is:

Accepted Answer

A) silver certificates 
B) demand deposits 
C) greenbacks 
D) Federal Reserve notes 
A) silver certificates 
B) demand deposits 
C) greenbacks 
D) Federal Reserve notes

Question 5

Which of the following statements is false?

Accepted Answer

A) Legal tender is money backed only by government credit. 
B) Credit money represents any circulating medium which has little real value relative to its monetary value. 
C) The Monetary Act of 1792 resulted in an early monetary system that relied almost exclusively on the use of foreign coins. 
D) All of the above statements are correct. 
A) Legal tender is money backed only by government credit. 
B) Credit money represents any circulating medium which has little real value relative to its monetary value. 
C) The Monetary Act of 1792 resulted in an early monetary system that relied almost exclusively on the use of foreign coins. 
D) All of the above statements are correct.

Question 6

Deposit money is backed by the creditworthiness of the depository institution that issued the deposit.

Accepted Answer

A) True 
 B)False

Question 7

Money decreed to be "legal tender" for the payment of debts is money backed by:

Accepted Answer

A) precious metals 
B) commodities 
C) government creditworthiness 
D) gold or silver 
A) precious metals 
B) commodities 
C) government creditworthiness 
D) gold or silver

Question 8

_____________ is a short-term debt instrument issued by commercial banks in denominations of $100,000 or more with typical maturities ranging from one month to one year that have an active secondary market that allows short-term investors to easily match their cash or liquidity needs when they arise.

Accepted Answer

A) A negotiable certificate of deposit (NC
D)  
B) A repurchase agreement 
C) Commercial paper 
D) Government bond 
E) all of the above 
A) A negotiable certificate of deposit (NC
D)  
B) A repurchase agreement 
C) Commercial paper 
D) Government bond 
E) all of the above

Question 9

The bimetallic standard was difficult to maintain because the market ratio between silver and gold changed constantly.

Accepted Answer

A) True 
 B)False

Question 10

Representative full-bodied money consists of paper money fully backed by a precious metal.

Accepted Answer

A) True 
 B)False

Question 11

Paper money backed by a precious metal is called:

Accepted Answer

A) full-bodied money 
B) a bimetallic standard 
C) representative full-bodied money 
D) none of the above 
A) full-bodied money 
B) a bimetallic standard 
C) representative full-bodied money 
D) none of the above

Question 12

_______________________issue shares to customers and invest the proceeds in highly liquid,very-short-maturity,interest-bearing debt instruments called money market investments.

Accepted Answer

A) Commercial banks 
B) Corporations 
C) Insurance companies 
D) none of the above 
A) Commercial banks 
B) Corporations 
C) Insurance companies 
D) none of the above

Question 13

The price level of goods and services may be expressed as the ratio of _____________.

Accepted Answer

A) GDP to GNP 
B) real output to GDP 
C) Velocity to GDP 
D) real output to velocity 
E) none of the above 
A) GDP to GNP 
B) real output to GDP 
C) Velocity to GDP 
D) real output to velocity 
E) none of the above

Question 14

Eurodollars are included in

Accepted Answer

A) M1 
B) M2 
C) both the above 
D) neither the above 
A) M1 
B) M2 
C) both the above 
D) neither the above

Question 15

Token coins are:

Accepted Answer

A) full-bodied coins 
B) coins containing metal of less value than their stated value 
C) coins containing gold or silver 
D) representative full-bodied money 
A) full-bodied coins 
B) coins containing metal of less value than their stated value 
C) coins containing gold or silver 
D) representative full-bodied money

Question 16

Keynesians believe that a change in the money supply first causes a change in interest rate levels,which,in turn,alters the demand for goods and services.

Accepted Answer

A) True 
 B)False

Question 17

Money market mutual funds do which of the following?

Accepted Answer

A) issue shares to customers 
B) invest in liquid instruments 
C) invest in interest-bearing debt instruments 
D) all the above 
A) issue shares to customers 
B) invest in liquid instruments 
C) invest in interest-bearing debt instruments 
D) all the above

Question 18

Fiat money generally becomes worthless if the issuing government - such as the Confederate government of the Civil War -fails.

Accepted Answer

A) True 
 B)False

Question 19

Currency held in vaults of depository institutions is excluded from M1.

Accepted Answer

A) True 
 B)False

Question 20

The broadest definition of money supply is:

Accepted Answer

A) M1 
B) M2 
C) M3 
D) M4 
A) M1 
B) M2 
C) M3 
D) M4

The U.S.bimetallic standard was based on:

The three functions of money are:

When coins have an intrinsic value equal to the value of the metal they contain,they are?referred to as:

The only paper money of significance in the economy today is:

Which of the following statements is false?

Deposit money is backed by the creditworthiness of the depository institution that issued the deposit.

Money decreed to be "legal tender" for the payment of debts is money backed by:

The bimetallic standard was difficult to maintain because the market ratio between silver and gold changed constantly.

Representative full-bodied money consists of paper money fully backed by a precious metal.

Paper money backed by a precious metal is called:

_______________________issue shares to customers and invest the proceeds in highly liquid,very-short-maturity,interest-bearing debt instruments called money market investments.

The price level of goods and services may be expressed as the ratio of _____________.

Eurodollars are included in

Token coins are:

Keynesians believe that a change in the money supply first causes a change in interest rate levels,which,in turn,alters the demand for goods and services.

Money market mutual funds do which of the following?

Fiat money generally becomes worthless if the issuing government - such as the Confederate government of the Civil War -fails.

Currency held in vaults of depository institutions is excluded from M1.

The broadest definition of money supply 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 U.S.bimetallic standard was based on:

The three functions of money are:

When coins have an intrinsic value equal to the value of the metal they contain,they are?referred to as:

The only paper money of significance in the economy today is:

Which of the following statements is false?

Deposit money is backed by the creditworthiness of the depository institution that issued the deposit.

Money decreed to be "legal tender" for the payment of debts is money backed by:

The bimetallic standard was difficult to maintain because the market ratio between silver and gold changed constantly.

Representative full-bodied money consists of paper money fully backed by a precious metal.

Paper money backed by a precious metal is called:

_______________________issue shares to customers and invest the proceeds in highly liquid,very-short-maturity,interest-bearing debt instruments called money market investments.

The price level of goods and services may be expressed as the ratio of _____________.

Eurodollars are included in

Token coins are:

Keynesians believe that a change in the money supply first causes a change in interest rate levels,which,in turn,alters the demand for goods and services.

Money market mutual funds do which of the following?

Fiat money generally becomes worthless if the issuing government - such as the Confederate government of the Civil War -fails.

Currency held in vaults of depository institutions is excluded from M1.

The broadest definition of money supply 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