Question 1

U.S.Treasury bills pay no interest but are sold at a ________.That is,you will pay a lower purchase price than the amount you receive at maturity.

Accepted Answer

A) premium 
B) collateral 
C) default 
D) discount 
A) premium 
B) collateral 
C) default 
D) discount

Question 2

A breakdown of financial markets can result in

Accepted Answer

A) financial stability. 
B) rapid economic growth. 
C) political instability. 
D) stable prices. 
A) financial stability. 
B) rapid economic growth. 
C) political instability. 
D) stable prices.

Question 3

A restriction on bank activities that was repealed in 1999 was

Accepted Answer

A) the prohibition of the payment of interest on checking deposits. 
B) restrictions on credit terms. 
C) minimum down payments on loans to purchase securities. 
D) separation of commercial banking from the securities industries. 
A) the prohibition of the payment of interest on checking deposits. 
B) restrictions on credit terms. 
C) minimum down payments on loans to purchase securities. 
D) separation of commercial banking from the securities industries.

Question 4

Every financial market has the following characteristic:

Accepted Answer

A) It determines the level of interest rates. 
B) It allows common stock to be traded. 
C) It allows loans to be made. 
D) It channels funds from lenders-savers to borrowers-spenders. 
A) It determines the level of interest rates. 
B) It allows common stock to be traded. 
C) It allows loans to be made. 
D) It channels funds from lenders-savers to borrowers-spenders.

Question 5

Which of the following instruments are traded in a capital market?

Accepted Answer

A) Corporate bonds. 
B) U.S.Treasury bills. 
C) Negotiable bank CDs. 
D) Repurchase agreements. 
A) Corporate bonds. 
B) U.S.Treasury bills. 
C) Negotiable bank CDs. 
D) Repurchase agreements.

Question 6

An important feature of money market mutual fund shares is

Accepted Answer

A) deposit insurance. 
B) the ability to write checks against shareholdings. 
C) the ability to borrow against shareholdings. 
D) claims on shares of corporate stock. 
A) deposit insurance. 
B) the ability to write checks against shareholdings. 
C) the ability to borrow against shareholdings. 
D) claims on shares of corporate stock.

Question 7

You can borrow $5000 to finance a new business venture.This new venture will generate annual earnings of $251.The maximum interest rate that you would pay on the borrowed funds and still increase your income is

Accepted Answer

A) 25%. 
B) 12.5%. 
C) 10%. 
D) 5%. 
A) 25%. 
B) 12.5%. 
C) 10%. 
D) 5%.

U.S.Treasury bills pay no interest but are sold at a ________.That is,you will pay a lower purchase price than the amount you receive at maturity.

A breakdown of financial markets can result in

A restriction on bank activities that was repealed in 1999 was

Every financial market has the following characteristic:

Which of the following instruments are traded in a capital market?

An important feature of money market mutual fund shares is

You can borrow $5000 to finance a new business venture.This new venture will generate annual earnings of $251.The maximum interest rate that you would pay on the borrowed funds and still increase your income is

Why Study Money, Banking, and Financial Markets

What Is Money

Understanding Interest Rates

The Behavior of Interest Rates

The Risk and Term Structure of Interest Rates

The Stock Market, the Theory of Rational Expectations, and the Efficient Market Hypothesis

An Economic Analysis of Financial Structure

Financial Crises and the Subprime Meltdown

Banking and the Management of Financial Institutions

Economic Analysis of Financial Regulation

Banking Industry: Structure and Competition

Central Banks and the Federal Reserve System

The Money Supply Process

Tools for Monetary Policy

The Conduct of Monetary Policy: Strategy and Tactics

The Foreign Exchange Market

The International Financial System

The Demand for Money

The Islm Model

Monetary and Fiscal Policy in the ISLM Model

Aggregate Demand and Supply Analysis

Transmission Mechanisms of Monetary Policy: The Evidence

Money and Inflation

Rational Expectations: Implications for Policy

Filters

Exam 2: An Overview of the Financial System

U.S.Treasury bills pay no interest but are sold at a ________.That is,you will pay a lower purchase price than the amount you receive at maturity.

A breakdown of financial markets can result in

A restriction on bank activities that was repealed in 1999 was

Every financial market has the following characteristic:

Which of the following instruments are traded in a capital market?

An important feature of money market mutual fund shares is

You can borrow $5000 to finance a new business venture.This new venture will generate annual earnings of $251.The maximum interest rate that you would pay on the borrowed funds and still increase your income is

Why Study Money, Banking, and Financial Markets

What Is Money

Understanding Interest Rates

The Behavior of Interest Rates

The Risk and Term Structure of Interest Rates

The Stock Market, the Theory of Rational Expectations, and the Efficient Market Hypothesis

An Economic Analysis of Financial Structure

Financial Crises and the Subprime Meltdown

Banking and the Management of Financial Institutions

Economic Analysis of Financial Regulation

Banking Industry: Structure and Competition

Central Banks and the Federal Reserve System

The Money Supply Process

Tools for Monetary Policy

The Conduct of Monetary Policy: Strategy and Tactics

The Foreign Exchange Market

The International Financial System

The Demand for Money

The Islm Model

Monetary and Fiscal Policy in the ISLM Model

Aggregate Demand and Supply Analysis

Transmission Mechanisms of Monetary Policy: The Evidence

Money and Inflation

Rational Expectations: Implications for Policy

Filters