Question 1

When money is held as an asset,it is serving as

Accepted Answer

A)  a standard of value.
B)  a standard of deferred payment.
C)  a medium of exchange.
D)  a store of value.E) None of the above
F) All of the above

Question 2

It is costly to hold money because

Accepted Answer

A)  deflation may reduce its purchasing power.
B)  in doing so one sacrifices interest income.
C)  bond prices are highly variable.
D)  the velocity of money may decline.E) B) and D)
F) A) and C)

Question 3

Which is NOT considered money?

Accepted Answer

A)  Checking account balances
B)  Traveler's checks issued by non-banks
C)  Credit cards
D)  CurrencyE) B) and C)
F) C) and D)

Question 4

Which statement is false?

Accepted Answer

A)  Until the 1980s,S & Ls were legally barred from paying shareholders more than a certain rate of interest.
B)  S & Ls were not in financial trouble until the late 1980s.
C)  The 1980s was not a very good decade for the S & Ls.
D)  Until the 1980s only commercial banks were legally allowed to issue checking accounts.E) A) and D)
F) B) and C)

Question 5

A goldsmith with 100 gold coins in his safe and 400 goldsmith's receipts in circulation has a reserve ratio of

Accepted Answer

A)  400%.
B)  100%.
C)  50%.
D)  25%.
E)  20%.F) A) and D)
G) B) and E)

Question 6

Unless money can perform its job as a ______,it doesn't matter that much if it performs its other jobs that well.

Accepted Answer

The answer of Unless money can perform its job as...

Question 7

Barter transactions cannot occur without a double __________.

Accepted Answer

coincidenc...

Question 8

If M3 is 5,000,small denomination time deposits are 700,and large denomination time deposits are 900,how much is M2?

Accepted Answer

M2 = 5,000...

Question 9

The typical fee for overdraft privileges is

Accepted Answer

A)  $5-10.
B)  $10-20.
C)  $10-38.
D)  $40-60.E) A) and B)
F) A) and C)

Question 10

In a fractional reserve banking system

Accepted Answer

A)  commercial banks are required to hold savings account in other banks as reserves against their deposits.
B)  commercial banks are required to hold a certain fraction of their deposits in reserves.
C)  all deposits must be held in reserves.
D)  commercial banks hold no deposits in reserve.E) All of the above
F) A) and C)

Question 11

Which of the following countries have the most banks in the top 10 in the world?

Accepted Answer

A)  The United States
B)  France.
C)  United Kingdom.
D)  Germany.E) None of the above
F) A) and B)

Question 12

Statement I: States that prohibit branch banking are unit banking states.
Statement II: To get a bank charter you need to demonstrate three things: (1) that your community needs a bank or an additional bank; (2) that you have enough capital to start a bank;and (3) that you are a good character.

Accepted Answer

A)  Statement I is true and statement II is false.
B)  Statement II is true and statement I is false.
C)  Both statements are true.
D)  Both statements are false.E) A) and D)
F) A) and C)

Question 13

What percent of the states do not allow any branch banking?

Accepted Answer

A)  10.
B)  20.
C)  40.
D)  60E) C) and D)
F) B) and C)

Question 14

Statement I: One job of money is as a store of value.
Statement II: Money may perform as a standard of value or as a medium of exchange,but not both at the same time.

Accepted Answer

A)  Statement I is true and statement II is false.
B)  Statement II is true and statement I is false.
C)  Both statements are true.
D)  Both statements are false.E) A) and C)
F) C) and D)

Question 15

Checkable deposits are money because they are

Accepted Answer

A)  legal tender.
B)  fiat money.
C)  a medium of exchange.
D)  token money.E) All of the above
F) A) and B)

Question 16

What percentage of the M2 measure of money is currency?

Accepted Answer

A)  Five.
B)  Ten.
C)  Fifteen.
D)  Twenty.E) None of the above
F) A) and D)

Question 17

Statement I: The U.S.dollar traces its roots back to the old Spanish-milled silver dollar.
Statement II: "Pieces of eight" means eight bits which means one dollar.

Accepted Answer

A)  Statement I is true and statement II is false.
B)  Statement II is true and statement I is false.
C)  Both statements are true.
D)  Both statements are false.E) A) and B)
F) B) and C)

Question 18

Statement I.Between 1987 and 1997 nearly one-third of all commercial banks failed.
Statement II: There are about 10 times as many commercial banks as savings and loan associations.

Accepted Answer

A)  Statement I is true and statement II is false.
B)  Statement II is true and statement I is false.
C)  Both statements are true.
D)  Both statements are false.E) C) and D)
F) B) and C)

Question 19

M1 = 1,000
Small denomination time deposits = 1,500
Savings deposit = 1,800
Money market mutual funds = 300
Large denomination time deposits = 800

-How much is M3?

Accepted Answer

M3 = 4,600...

Question 20

Money is created when banks ________.

Accepted Answer

The answer of Money is created when banks ________....

Exam 13: Money and Banking

Statement I: The U.S.dollar traces its roots back to the old Spanish-milled silver dollar. Statement II: "Pieces of eight" means eight bits which means one dollar.

Correct AnswerverifiedShow Answer

What percent of the states do not allow any branch banking?

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Which is NOT considered money?

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Barter transactions cannot occur without a double __________.

Correct Answerverifiedcoincidenc...View AnswerShow Answer

What percentage of the M2 measure of money is currency?

Correct AnswerverifiedShow Answer

It is costly to hold money because

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Statement I: One job of money is as a store of value. Statement II: Money may perform as a standard of value or as a medium of exchange,but not both at the same time.

Correct AnswerverifiedShow Answer

If M3 is 5,000,small denomination time deposits are 700,and large denomination time deposits are 900,how much is M2?

Correct AnswerverifiedM2 = 5,000...View AnswerShow Answer

When money is held as an asset,it is serving as

Correct AnswerverifiedShow Answer

In a fractional reserve banking system

Correct AnswerverifiedShow Answer

Statement I.Between 1987 and 1997 nearly one-third of all commercial banks failed. Statement II: There are about 10 times as many commercial banks as savings and loan associations.

Correct AnswerverifiedShow Answer

Statement I: States that prohibit branch banking are unit banking states. Statement II: To get a bank charter you need to demonstrate three things: (1) that your community needs a bank or an additional bank; (2) that you have enough capital to start a bank;and (3) that you are a good character.

Correct AnswerverifiedShow Answer

Which of the following countries have the most banks in the top 10 in the world?

Correct AnswerverifiedShow Answer

A goldsmith with 100 gold coins in his safe and 400 goldsmith's receipts in circulation has a reserve ratio of

Correct AnswerverifiedShow Answer

M1 = 1,000 Small denomination time deposits = 1,500 Savings deposit = 1,800 Money market mutual funds = 300 Large denomination time deposits = 800 -How much is M3?

Correct AnswerverifiedM3 = 4,600...View AnswerShow Answer

Checkable deposits are money because they are

Correct AnswerverifiedShow Answer

Unless money can perform its job as a ______,it doesn't matter that much if it performs its other jobs that well.

Correct AnswerverifiedShow Answer

The typical fee for overdraft privileges is

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Which statement is false?

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Money is created when banks ________.

Correct AnswerverifiedShow Answer

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coincidenc...
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M2 = 5,000...
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M3 = 4,600...
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