Question 1

Money,in the form of currency,can be used for future purchases and thus illustrates the ________ function of money.

Accepted Answer

A)  basis for banking 
B)  medium of exchange 
C)  store of value 
D)  unit of account 
A)  basis for banking 
B)  medium of exchange 
C)  store of value 
D)  unit of account C

Question 2

Individual retirement accounts can be opened only by self-employed people such as doctors,small business owners,and consultants.

Accepted Answer

A) True 
 B)False  False

Question 3

Describe the structure of the Federal Reserve System.

Accepted Answer

The Federal Reserve System consists of a board of governors,a group of reserve banks,and member banks.The Fed's board of governors consists of seven members appointed by the president for overlapping terms of 14 years.The chair of the board serves on major economic advisory committees and works actively with the administration to formulate economic policy.All nationally chartered commercial banks are members of the Federal Reserve System,as are some state-charted banks.

Question 4

When the Fed buys securities through open-market operations,the money supply is reduced.

Accepted Answer

A) True 
 B)False

Question 5

Short Case Scenario 15-1
John Smith, a Minnesota native, has recently been elected to the U.S. House of Representatives. John, a long-time college professor, was elected on a platform of educational reform. Somehow, John finds himself appointed to the Joint Economic and Financial Services Committees. John is having a hard time understanding the testimony before each committee, but is hesitant to ask too many questions.
-There is discussion of a bill raising insurance on bank deposits.Explain to John who insures bank deposits and the current limit.

Accepted Answer

The Federal Deposit Insurance Corporatio

Question 6

A nondeposit financial institution that invests funds collected as premiums to provide coverage against losses is a(n)________.

Accepted Answer

A)  credit union 
B)  securities investment dealer 
C)  insurance company 
D)  finance company 
A)  credit union 
B)  securities investment dealer 
C)  insurance company 
D)  finance company

Question 7

A smart card has an embedded computer chip that can be programmed with "electronic money." These cards are also known as

Accepted Answer

A)  electronic purses 
B)  stored value cards 
C)  both A and B 
D)  none of the above 
A)  electronic purses 
B)  stored value cards 
C)  both A and B 
D)  none of the above

Question 8

A(n)________ is a financial institution accepting deposits and making loans primarily for home mortgages.

Accepted Answer

A)  investment club 
B)  credit union 
C)  commercial bank 
D)  savings and loan association 
A)  investment club 
B)  credit union 
C)  commercial bank 
D)  savings and loan association

Question 9

Does money flow back and forth between countries for every transaction that takes place? Explain.

Accepted Answer

No.For example,payments from U.S.buyers

Question 10

As the government's bank,the Fed produces the nation's paper currency and lends money to the government.

Accepted Answer

A) True 
 B)False

Question 11

Money lets you measure the relative values of goods and services.In so doing,money is performing which of the following functions?

Accepted Answer

A)  store of value 
B)  measure of worth 
C)  determination factor 
D)  monetary flagging 
A)  store of value 
B)  measure of worth 
C)  determination factor 
D)  monetary flagging

Question 12

Through the FDIC,a deposit in a member bank is currently insured up to $50,000.

Accepted Answer

A) True 
 B)False

Question 13

Explain the difference in payments between a banker's acceptance and a letter of credit.

Accepted Answer

A banker's acceptance requires

Question 14

When savings and loan associations were created,what did they offer?

Accepted Answer

Most S&Ls were creat

Question 15

A ________ is a promise by a bank to pay a foreign firm a certain amount of money if specific conditions are met.

Accepted Answer

A)  currency exchange 
B)  letter of credit 
C)  financial advisement 
D)  banker's acceptance 
A)  currency exchange 
B)  letter of credit 
C)  financial advisement 
D)  banker's acceptance

Question 16

It is rare for a bank to offer its customers currency exchange.

Accepted Answer

A) True 
 B)False

Question 17

Regarding the international payments process,which statement is true?

Accepted Answer

A)  Diplomatic pouches move currency payments from one nation to another. 
B)  Banks do not get involved in such transactions. 
C)  Most foreign nations never accept dollars. 
D)  Money does not actually have to flow between two countries. 
A)  Diplomatic pouches move currency payments from one nation to another. 
B)  Banks do not get involved in such transactions. 
C)  Most foreign nations never accept dollars. 
D)  Money does not actually have to flow between two countries.

Question 18

What are the four characteristics of money?

Accepted Answer

For an object to serve as money,it must

Question 19

The Customer Identification Program (CIP)was implemented as a requirement of the USA Patriot Act.

Accepted Answer

A) True 
 B)False

Question 20

Banks expand the money supply by ________.

Accepted Answer

A)  opening new checking accounts 
B)  printing money 
C)  taking in deposits and loaning money 
D)  paying interest on accounts 
A)  opening new checking accounts 
B)  printing money 
C)  taking in deposits and loaning money 
D)  paying interest on accounts

Money,in the form of currency,can be used for future purchases and thus illustrates the ________ function of money.

Individual retirement accounts can be opened only by self-employed people such as doctors,small business owners,and consultants.

Describe the structure of the Federal Reserve System.

When the Fed buys securities through open-market operations,the money supply is reduced.

A nondeposit financial institution that invests funds collected as premiums to provide coverage against losses is a(n)________.

A smart card has an embedded computer chip that can be programmed with "electronic money." These cards are also known as

A(n)________ is a financial institution accepting deposits and making loans primarily for home mortgages.

Does money flow back and forth between countries for every transaction that takes place? Explain.

As the government's bank,the Fed produces the nation's paper currency and lends money to the government.

Money lets you measure the relative values of goods and services.In so doing,money is performing which of the following functions?

Through the FDIC,a deposit in a member bank is currently insured up to $50,000.

Explain the difference in payments between a banker's acceptance and a letter of credit.

When savings and loan associations were created,what did they offer?

A ________ is a promise by a bank to pay a foreign firm a certain amount of money if specific conditions are met.

It is rare for a bank to offer its customers currency exchange.

Regarding the international payments process,which statement is true?

What are the four characteristics of money?

The Customer Identification Program (CIP)was implemented as a requirement of the USA Patriot Act.

Banks expand the money supply by ________.

The U.S.Business Environment

Business Ethics and Social Responsibility

Entrepreneurship, New Ventures, and Business Ownership

The Global Context of Business

Business Management

Organizing the Business

Operations Management and Quality

Employee Behavior and Motivation

Leadership and Decision Making

Human Resource Management and Labor Relations

Marketing Processes and Consumer Behavior

Pricing, Distributing, and Promoting Products

The Role of Accountants and Accounting Information

Managing Finances

Filters

Exam 15: Money and Banking

Money,in the form of currency,can be used for future purchases and thus illustrates the ________ function of money.

Individual retirement accounts can be opened only by self-employed people such as doctors,small business owners,and consultants.

Describe the structure of the Federal Reserve System.

When the Fed buys securities through open-market operations,the money supply is reduced.

A nondeposit financial institution that invests funds collected as premiums to provide coverage against losses is a(n)________.

A smart card has an embedded computer chip that can be programmed with "electronic money." These cards are also known as

A(n)________ is a financial institution accepting deposits and making loans primarily for home mortgages.

Does money flow back and forth between countries for every transaction that takes place? Explain.

As the government's bank,the Fed produces the nation's paper currency and lends money to the government.

Money lets you measure the relative values of goods and services.In so doing,money is performing which of the following functions?

Through the FDIC,a deposit in a member bank is currently insured up to $50,000.

Explain the difference in payments between a banker's acceptance and a letter of credit.

When savings and loan associations were created,what did they offer?

A ________ is a promise by a bank to pay a foreign firm a certain amount of money if specific conditions are met.

It is rare for a bank to offer its customers currency exchange.

Regarding the international payments process,which statement is true?

What are the four characteristics of money?

The Customer Identification Program (CIP)was implemented as a requirement of the USA Patriot Act.

Banks expand the money supply by ________.

The U.S.Business Environment

Business Ethics and Social Responsibility

Entrepreneurship, New Ventures, and Business Ownership

The Global Context of Business

Business Management

Organizing the Business

Operations Management and Quality

Employee Behavior and Motivation

Leadership and Decision Making

Human Resource Management and Labor Relations

Marketing Processes and Consumer Behavior

Pricing, Distributing, and Promoting Products

The Role of Accountants and Accounting Information

Managing Finances

Filters