Question 1

The National Monetary Commission

Accepted Answer

A)  was created by Congress to study the setting up of a central bank. 
B)  authorizes open market operations. 
C)  oversees nationally chartered banks. 
D)  chooses Federal Reserve district bank presidents. 
A)  was created by Congress to study the setting up of a central bank. 
B)  authorizes open market operations. 
C)  oversees nationally chartered banks. 
D)  chooses Federal Reserve district bank presidents. A

Question 2

How many Federal Reserve districts are there?

Accepted Answer

A)  1 
B)  2 
C)  12 
D)  50 
A)  1 
B)  2 
C)  12 
D)  50 C

Question 3

How do individual become members of the Board of Governors?

Accepted Answer

They are appointed by the President and confirmed by the Senate.

Question 4

What are the limitations to the Fed's independence?

Accepted Answer

First,the president can exercise control

Question 5

Under the Federal Reserve Act,which banks must be members of the Federal Reserve System?

Accepted Answer

A)  all commercial banks 
B)  national banks 
C)  state banks 
D)  all banks with capital in excess of $100 million 
A)  all commercial banks 
B)  national banks 
C)  state banks 
D)  all banks with capital in excess of $100 million

Question 6

What is the name of the entity,composed of Federal Reserve district bankers,that consults on monetary policy?

Accepted Answer

A)  The Federal Open Market Committee 
B)  The Federal Advisory Council 
C)  The Monetary Policy Council 
D)  The District Bank Committee 
A)  The Federal Open Market Committee 
B)  The Federal Advisory Council 
C)  The Monetary Policy Council 
D)  The District Bank Committee

Question 7

Federal Reserve district banks perform all of the following roles EXCEPT

Accepted Answer

A)  managing checking clearing in the payments system. 
B)  performing regulatory functions. 
C)  setting the federal funds rate. 
D)  managing currency in circulation by issuing new Federal Reserve Notes. 
A)  managing checking clearing in the payments system. 
B)  performing regulatory functions. 
C)  setting the federal funds rate. 
D)  managing currency in circulation by issuing new Federal Reserve Notes.

Question 8

The principal-agent view of Fed motivation predicts that the Fed acts

Accepted Answer

A)  to promote the interests of the general public. 
B)  to promote the interests of the Fed's principal the President of the United States. 
C)  in order to increase its power, influence, and prestige. 
D)  in order to make sure its agents commercial banks carry out its wishes. 
A)  to promote the interests of the general public. 
B)  to promote the interests of the Fed's principal the President of the United States. 
C)  in order to increase its power, influence, and prestige. 
D)  in order to make sure its agents commercial banks carry out its wishes.

Question 9

The Fed does not have to go through the normal congressional appropriations process because

Accepted Answer

A)  its expenses are very small. 
B)  it was given enough funds at the time of its founding to provide for its expenses indefinitely. 
C)  it is self financing. 
D)  it is not part of the legislative branch of the federal government. 
A)  its expenses are very small. 
B)  it was given enough funds at the time of its founding to provide for its expenses indefinitely. 
C)  it is self financing. 
D)  it is not part of the legislative branch of the federal government.

Question 10

When did the Federal Reserve Act become law?

Accepted Answer

A)  1836 
B)  1913 
C)  1936 
D)  1951 
A)  1836 
B)  1913 
C)  1936 
D)  1951

Question 11

The members of Federal Reserve district bank boards of directors who represent the public interest are known as

Accepted Answer

A)  Class A directors. 
B)  Class B directors. 
C)  Class C directors. 
D)  Class D directors. 
A)  Class A directors. 
B)  Class B directors. 
C)  Class C directors. 
D)  Class D directors.

Question 12

Which of the following is NOT an activity carried out by Federal Reserve district banks?

Accepted Answer

A)  open market operations 
B)  issuing new Federal Reserve Notes 
C)  making discount loans 
D)  examining state member banks 
A)  open market operations 
B)  issuing new Federal Reserve Notes 
C)  making discount loans 
D)  examining state member banks

Question 13

The members of Federal Reserve district bank boards of directors who are bankers are known as

Accepted Answer

A)  Class A directors. 
B)  Class B directors. 
C)  Class C directors. 
D)  Class D directors. 
A)  Class A directors. 
B)  Class B directors. 
C)  Class C directors. 
D)  Class D directors.

Question 14

Members of the Board of Governors are

Accepted Answer

A)  elected by the district bank presidents. 
B)  appointed by the President of the United States, subject to confirmation by the Senate. 
C)  appointed by the National Monetary Commission. 
D)  appointed by the Securities and Exchange Commission, subject to congressional veto. 
A)  elected by the district bank presidents. 
B)  appointed by the President of the United States, subject to confirmation by the Senate. 
C)  appointed by the National Monetary Commission. 
D)  appointed by the Securities and Exchange Commission, subject to congressional veto.

Question 15

The political business cycle theory predicts that

Accepted Answer

A)  the Fed acts to promote the interests of the general public. 
B)  the Fed acts to stimulate economic activity before an election. 
C)  the President's appointments to the Board of Governors will usually be politicians. 
D)  political factors over which the Fed has no control are most important in explaining the business cycle. 
A)  the Fed acts to promote the interests of the general public. 
B)  the Fed acts to stimulate economic activity before an election. 
C)  the President's appointments to the Board of Governors will usually be politicians. 
D)  political factors over which the Fed has no control are most important in explaining the business cycle.

Question 16

Who had served as a de facto lender of last resort during the 1907 panic?

Accepted Answer

A)  The U.S. Treasury 
B)  J. P. Morgan 
C)  Henry Ford 
D)  John D. Rockefeller 
A)  The U.S. Treasury 
B)  J. P. Morgan 
C)  Henry Ford 
D)  John D. Rockefeller

Question 17

Which president failed to renew the charter of the Second Bank of the United States?

Accepted Answer

A)  George Washington 
B)  Andrew Jackson 
C)  Franklin Roosevelt 
D)  Lyndon Johnson 
A)  George Washington 
B)  Andrew Jackson 
C)  Franklin Roosevelt 
D)  Lyndon Johnson

Question 18

To conduct open market operations,the FOMC issues a directive to

Accepted Answer

A)  the trading desk at the Federal Reserve Bank of New York. 
B)  the Board of Governors in Washington, D.C. 
C)  the presidents of the district banks. 
D)  the chairman of the New York Stock Exchange. 
A)  the trading desk at the Federal Reserve Bank of New York. 
B)  the Board of Governors in Washington, D.C. 
C)  the presidents of the district banks. 
D)  the chairman of the New York Stock Exchange.

Question 19

What are the roles of Federal Reserve district banks?

Accepted Answer

The roles of district banks include mana

Question 20

Which of the following cities contains a Federal Reserve bank?

Accepted Answer

A)  Pittsburgh 
B)  Los Angeles 
C)  Seattle 
D)  Dallas 
A)  Pittsburgh 
B)  Los Angeles 
C)  Seattle 
D)  Dallas

The National Monetary Commission

How many Federal Reserve districts are there?

How do individual become members of the Board of Governors?

What are the limitations to the Fed's independence?

Under the Federal Reserve Act,which banks must be members of the Federal Reserve System?

What is the name of the entity,composed of Federal Reserve district bankers,that consults on monetary policy?

Federal Reserve district banks perform all of the following roles EXCEPT

The principal-agent view of Fed motivation predicts that the Fed acts

The Fed does not have to go through the normal congressional appropriations process because

When did the Federal Reserve Act become law?

The members of Federal Reserve district bank boards of directors who represent the public interest are known as

Which of the following is NOT an activity carried out by Federal Reserve district banks?

The members of Federal Reserve district bank boards of directors who are bankers are known as

Members of the Board of Governors are

The political business cycle theory predicts that

Who had served as a de facto lender of last resort during the 1907 panic?

Which president failed to renew the charter of the Second Bank of the United States?

To conduct open market operations,the FOMC issues a directive to

What are the roles of Federal Reserve district banks?

Which of the following cities contains a Federal Reserve bank?

Introducing Money and the Financial System

Money and the Payments System

Interest Rates and Rates of Return

Determining Interest Rates

The Risk Structure and Term Structure of Interest Rates

The Stock Market, information, and Financial Market Efficiency

Derivatives and Derivative Markets

The Market for Foreign Exchange

Transactions Costs, asymmetric Information, and the Structure of the Financial System

The Economics of Banking

Investment Banks, mutual Funds, hedge Funds, and the Shadow Banking System

Financial Crises and Financial Regulation

The Federal Reserves Balance Sheet and the Money Supply Process

Monetary Policy

The International Financial System and Monetary Policy

Monetary Theory I: the Aggregate Demand and Aggregate Supply Model

Monetary Theory Ii: the Is-Mp Model

Filters

Exam 13: The Federal Reserve and Central Banking

The National Monetary Commission

How many Federal Reserve districts are there?

How do individual become members of the Board of Governors?

What are the limitations to the Fed's independence?

Under the Federal Reserve Act,which banks must be members of the Federal Reserve System?

What is the name of the entity,composed of Federal Reserve district bankers,that consults on monetary policy?

Federal Reserve district banks perform all of the following roles EXCEPT

The principal-agent view of Fed motivation predicts that the Fed acts

The Fed does not have to go through the normal congressional appropriations process because

When did the Federal Reserve Act become law?

The members of Federal Reserve district bank boards of directors who represent the public interest are known as

Which of the following is NOT an activity carried out by Federal Reserve district banks?

The members of Federal Reserve district bank boards of directors who are bankers are known as

Members of the Board of Governors are

The political business cycle theory predicts that

Who had served as a de facto lender of last resort during the 1907 panic?

Which president failed to renew the charter of the Second Bank of the United States?

To conduct open market operations,the FOMC issues a directive to

What are the roles of Federal Reserve district banks?

Which of the following cities contains a Federal Reserve bank?

Introducing Money and the Financial System

Money and the Payments System

Interest Rates and Rates of Return

Determining Interest Rates

The Risk Structure and Term Structure of Interest Rates

The Stock Market, information, and Financial Market Efficiency

Derivatives and Derivative Markets

The Market for Foreign Exchange

Transactions Costs, asymmetric Information, and the Structure of the Financial System

The Economics of Banking

Investment Banks, mutual Funds, hedge Funds, and the Shadow Banking System

Financial Crises and Financial Regulation

The Federal Reserves Balance Sheet and the Money Supply Process

Monetary Policy

The International Financial System and Monetary Policy

Monetary Theory I: the Aggregate Demand and Aggregate Supply Model

Monetary Theory Ii: the Is-Mp Model

Filters