Question 1

A decrease in the reserve requirement would:

Accepted Answer

A) decrease excess reserves and reflect an expansionary monetary policy. 
B) decrease excess reserves and reflect a contractionary monetary policy. 
C) increase excess reserves and reflect an expansionary monetary policy. 
D) increase excess reserves and reflect a contractionary monetary policy. 
A) decrease excess reserves and reflect an expansionary monetary policy. 
B) decrease excess reserves and reflect a contractionary monetary policy. 
C) increase excess reserves and reflect an expansionary monetary policy. 
D) increase excess reserves and reflect a contractionary monetary policy. C

Question 2

How many Federal Reserve District Banks are there?

Accepted Answer

A) 5 
B) 7 
C) 12 
D) 1 
A) 5 
B) 7 
C) 12 
D) 1 C

Question 3

The function of money that enables prices of goods and services to be quoted is called:

Accepted Answer

A) medium of exchange. 
B) store of value. 
C) unit of account. 
D) measure of power. 
A) medium of exchange. 
B) store of value. 
C) unit of account. 
D) measure of power. C

Question 4

The money multiplier is computed as follows:

Accepted Answer

A) (c + 1)/(c + rr + e). 
B) (c + 1)/(c + rr). 
C) 1/rr. 
D) (c + 1)/(c + e). 
A) (c + 1)/(c + rr + e). 
B) (c + 1)/(c + rr). 
C) 1/rr. 
D) (c + 1)/(c + e).

Question 5

The simple deposit multiplier is:

Accepted Answer

A) 1/excess reserves. 
B) 1/reserve requirement. 
C) 1/deposit requirement. 
D) none of the above. 
A) 1/excess reserves. 
B) 1/reserve requirement. 
C) 1/deposit requirement. 
D) none of the above.

Question 6

During the 1920s, the discount rate was the major policy tool of the Federal Reserve.

Accepted Answer

A) True 
 B)False

Question 7

In the context of the money market, graphically illustrate and explain the impact of an expansionary monetary policy on interest rates.

Accepted Answer

An increase in the nominal money supply

Question 8

The primary responsibility of conducting monetary policy rests with the:

Accepted Answer

A) Board of Governors. 
B) Federal Open Market Committee. 
C) Federal Deposit Insurance Corporation. 
D) U)S. Treasury. 
A) Board of Governors. 
B) Federal Open Market Committee. 
C) Federal Deposit Insurance Corporation. 
D) U)S. Treasury.

Question 9

An increase in the discount rate will result in:

Accepted Answer

A) increase in bank reserves and a decrease in the federal funds rate. 
B) increase in bank reserves and an increase in the federal funds rate. 
C) decrease in bank reserves and a decrease in the federal funds rate. 
D) decrease in bank reserves and an increase in the federal funds rate. 
A) increase in bank reserves and a decrease in the federal funds rate. 
B) increase in bank reserves and an increase in the federal funds rate. 
C) decrease in bank reserves and a decrease in the federal funds rate. 
D) decrease in bank reserves and an increase in the federal funds rate.

Question 10

Open market purchase will result in:

Accepted Answer

A) increase in bank reserves and a decrease in the federal funds rate. 
B) increase in bank reserves and an increase in the federal funds rate. 
C) decrease in bank reserves and a decrease in the federal funds rate. 
D) decrease in bank reserves and an increase in the federal funds rate. 
A) increase in bank reserves and a decrease in the federal funds rate. 
B) increase in bank reserves and an increase in the federal funds rate. 
C) decrease in bank reserves and a decrease in the federal funds rate. 
D) decrease in bank reserves and an increase in the federal funds rate.

Question 11

The interest rate the Federal Reserve charges banks which borrow reserves at the Federal Reserve's discount window is called the:

Accepted Answer

A) federal funds rate. 
B) discount rate. 
C) prime interest rate. 
D) mortgage interest rate. 
A) federal funds rate. 
B) discount rate. 
C) prime interest rate. 
D) mortgage interest rate.

Question 12

The Resolution Trust Corporation insures bank deposits.

Accepted Answer

A) True 
 B)False

Question 13

Large denomination time deposits are included in:

Accepted Answer

A) M1. 
B) M2. 
C) M3. 
D) L) 
A) M1. 
B) M2. 
C) M3. 
D) L)

Question 14

The money supply consists of:

Accepted Answer

A) currency plus reserves. 
B) currency plus required reserves. 
C) currency plus excess reserves. 
D) currency plus demand deposits. 
A) currency plus reserves. 
B) currency plus required reserves. 
C) currency plus excess reserves. 
D) currency plus demand deposits.

Question 15

Real money supply expresses the money supply in terms of real goods and services.

Accepted Answer

A) True 
 B)False

Question 16

The reserve requirement is 0.10.What is the simple deposit multiplier?

Accepted Answer

A) 2 
B) 20 
C) 0)2 
D) 10 
A) 2 
B) 20 
C) 0)2 
D) 10

Question 17

The interest rate that commercial banks charge each other for loans of reserves to meet their minimum reserve requirements is called:

Accepted Answer

A) treasury bill rate. 
B) federal funds rate. 
C) prime interest rate. 
D) none of the above. 
A) treasury bill rate. 
B) federal funds rate. 
C) prime interest rate. 
D) none of the above.

Question 18

In the money market, an excess demand for money is equivalent to an excess demand for bonds.

Accepted Answer

A) True 
 B)False

Question 19

The banking system in the U.S.is based on:

Accepted Answer

A) 100 percent reserve banking. 
B) fractional reserve banking. 
C) 0 percent reserve banking. 
D) none of the above. 
A) 100 percent reserve banking. 
B) fractional reserve banking. 
C) 0 percent reserve banking. 
D) none of the above.

Question 20

There are ________ voting members on the FOMC.

Accepted Answer

A) 4 
B) 7 
C) 12 
D) 15 
A) 4 
B) 7 
C) 12 
D) 15

A decrease in the reserve requirement would:

How many Federal Reserve District Banks are there?

The function of money that enables prices of goods and services to be quoted is called:

The money multiplier is computed as follows:

The simple deposit multiplier is:

During the 1920s, the discount rate was the major policy tool of the Federal Reserve.

In the context of the money market, graphically illustrate and explain the impact of an expansionary monetary policy on interest rates.

The primary responsibility of conducting monetary policy rests with the:

An increase in the discount rate will result in:

Open market purchase will result in:

The interest rate the Federal Reserve charges banks which borrow reserves at the Federal Reserve's discount window is called the:

The Resolution Trust Corporation insures bank deposits.

Large denomination time deposits are included in:

The money supply consists of:

Real money supply expresses the money supply in terms of real goods and services.

The reserve requirement is 0.10.What is the simple deposit multiplier?

The interest rate that commercial banks charge each other for loans of reserves to meet their minimum reserve requirements is called:

In the money market, an excess demand for money is equivalent to an excess demand for bonds.

The banking system in the U.S.is based on:

There are ________ voting members on the FOMC.

Managers and Economics

Demand, Supply, and Equilibrium Prices

Demand Elasticities

Techniques for Understanding Consumer Demand and Behavior

Production and Cost Analysis in the Short Run

Production and Cost Analysis in the Long Run

Market Structure: Perfect Competition

Market Structure: Monopoly and Monopolistic Competition

Market Structure: Oligopoly

Pricing Strategies for the Firm

Measuring Macroeconomic Activity

Spending by Individuals, Firms, and Governments on Real Goods and Services

The Aggregate Model of the Macro Economy

International and Balance of Payments Issues in the Macro Economy

Combining Micro and Macro Analysis for Managerial Decision Making

Filters

Exam 13: The Role of Money in the Macro Economy

A decrease in the reserve requirement would:

How many Federal Reserve District Banks are there?

The function of money that enables prices of goods and services to be quoted is called:

The money multiplier is computed as follows:

The simple deposit multiplier is:

During the 1920s, the discount rate was the major policy tool of the Federal Reserve.

In the context of the money market, graphically illustrate and explain the impact of an expansionary monetary policy on interest rates.

The primary responsibility of conducting monetary policy rests with the:

An increase in the discount rate will result in:

Open market purchase will result in:

The interest rate the Federal Reserve charges banks which borrow reserves at the Federal Reserve's discount window is called the:

The Resolution Trust Corporation insures bank deposits.

Large denomination time deposits are included in:

The money supply consists of:

Real money supply expresses the money supply in terms of real goods and services.

The reserve requirement is 0.10.What is the simple deposit multiplier?

The interest rate that commercial banks charge each other for loans of reserves to meet their minimum reserve requirements is called:

In the money market, an excess demand for money is equivalent to an excess demand for bonds.

The banking system in the U.S.is based on:

There are ________ voting members on the FOMC.

Managers and Economics

Demand, Supply, and Equilibrium Prices

Demand Elasticities

Techniques for Understanding Consumer Demand and Behavior

Production and Cost Analysis in the Short Run

Production and Cost Analysis in the Long Run

Market Structure: Perfect Competition

Market Structure: Monopoly and Monopolistic Competition

Market Structure: Oligopoly

Pricing Strategies for the Firm

Measuring Macroeconomic Activity

Spending by Individuals, Firms, and Governments on Real Goods and Services

The Aggregate Model of the Macro Economy

International and Balance of Payments Issues in the Macro Economy

Combining Micro and Macro Analysis for Managerial Decision Making

Filters