Question 1

An owner of which form of stock would receive dividend payments first?

Accepted Answer

A) Convertible securities 
B) Common stock 
C) Preferred stock 
D) Standard stock 
A) Convertible securities 
B) Common stock 
C) Preferred stock 
D) Standard stock C

Question 2

M1 consists of currency in circulation and balances in bank checking accounts.

Accepted Answer

A) True 
 B)False  True

Question 3

Life insurance companies tend to invest excess funds in short-term securities,while pension funds tend to invest excess funds in long-term securities.

Accepted Answer

A) True 
 B)False  False

Question 4

Complete the following using the terms listed.
a.bonds
b.Commercial banks
c.NASDAQ
d.Credit unions
e.financial system
f.call provision
g.insider trading
h.Federal Open Market Committee (FOMC)
i.Securities
j.New York Stock Exchange
k.Internet-only banks
l.limit order
m.debentures
n.primary market
o.net savers
-The use of material nonpublic information about a company to make an investment profit is known as _____.

Accepted Answer

The answer of Complete the following using the terms listed.
a.bonds
b.Commercial...

Question 5

All of the following are included in M1 EXCEPT __________.

Accepted Answer

A) money market mutual funds 
B) total value of coins 
C) checking accounts 
D) currency in circulation 
A) money market mutual funds 
B) total value of coins 
C) checking accounts 
D) currency in circulation

Question 6

As market interest rates rise,bond prices fall.

Accepted Answer

A) True 
 B)False

Question 7

Preferred stockholders receive fixed dividends.

Accepted Answer

A) True 
 B)False

Question 8

Municipal bonds are exempt from interest payments of federal income tax.

Accepted Answer

A) True 
 B)False

Question 9

Municipal bonds are bonds issued by the federal government.

Accepted Answer

A) True 
 B)False

Question 10

Operating under severe recessionary conditions,the Federal Reserve System decides to reduce its reserve requirements from the current level of 9% to 7.5%.Which of the following is likely to happen following the Fed's move?

Accepted Answer

A) The rate of unemployment will double. 
B) The rate of growth in the economy will fall drastically. 
C) It increases the availability of credit with the commercial banks. 
D) Businesses will find it difficult to borrow at cheaper rates of interest. 
A) The rate of unemployment will double. 
B) The rate of growth in the economy will fall drastically. 
C) It increases the availability of credit with the commercial banks. 
D) Businesses will find it difficult to borrow at cheaper rates of interest.

Question 11

______ is a form of short-term financing sold by corporations,such as Raytheon,that mature from 1 to 270 days from the date of issue.

Accepted Answer

A) Bonds 
B) CDs 
C) Treasury bills 
D) Commercial paper 
A) Bonds 
B) CDs 
C) Treasury bills 
D) Commercial paper

Question 12

Secured bonds are backed by a specific pledge of company assets.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following financial institutions is organized as a not-for-profit cooperative?

Accepted Answer

A) Commercial bank 
B) Credit union 
C) Life insurance company 
D) Savings bank 
A) Commercial bank 
B) Credit union 
C) Life insurance company 
D) Savings bank

Question 14

Underwriting is the process used by insurance companies to determine whom to insure and what to charge.

Accepted Answer

A) True 
 B)False

Question 15

A ______ is a time deposit at a financial institution,such as a commercial bank,savings bank,or credit union.

Accepted Answer

A) commercial paper 
B) treasury bill 
C) certificate of deposit 
D) bond 
A) commercial paper 
B) treasury bill 
C) certificate of deposit 
D) bond

Question 16

Funds can be transferred between savers and users in two ways: ________________.

Accepted Answer

A) individually and collectively 
B) in person and electronically 
C) directly and indirectly 
D) free and with user charges 
A) individually and collectively 
B) in person and electronically 
C) directly and indirectly 
D) free and with user charges

Question 17

The U.S.Department of Treasury sells what type of bonds?

Accepted Answer

A) Corporate bonds 
B) Government bonds 
C) Certificate of deposits bonds 
D) Municipal bonds 
A) Corporate bonds 
B) Government bonds 
C) Certificate of deposits bonds 
D) Municipal bonds

Question 18

Deposit insurance means that,in the event the bank fails,depositors are paid in full by the FDIC,up to $250,000.

Accepted Answer

A) True 
 B)False

Question 19

Complete the following using the terms listed.
a.bonds
b.Commercial banks
c.NASDAQ
d.Credit unions
e.financial system
f.call provision
g.insider trading
h.Federal Open Market Committee (FOMC)
i.Securities
j.New York Stock Exchange
k.Internet-only banks
l.limit order
m.debentures
n.primary market
o.net savers
-Ally Bank is an example of _____.

Accepted Answer

The answer of Complete the following using the terms listed.
a.bonds
b.Commercial...

Question 20

In the U.S.financial system,which of the following is a net saver?

Accepted Answer

A) Household 
B) Business 
C) The government 
D) Financial institution 
A) Household 
B) Business 
C) The government 
D) Financial institution

An owner of which form of stock would receive dividend payments first?

M1 consists of currency in circulation and balances in bank checking accounts.

Life insurance companies tend to invest excess funds in short-term securities,while pension funds tend to invest excess funds in long-term securities.

All of the following are included in M1 EXCEPT __________.

As market interest rates rise,bond prices fall.

Preferred stockholders receive fixed dividends.

Municipal bonds are exempt from interest payments of federal income tax.

Municipal bonds are bonds issued by the federal government.

Operating under severe recessionary conditions,the Federal Reserve System decides to reduce its reserve requirements from the current level of 9% to 7.5%.Which of the following is likely to happen following the Fed's move?

______ is a form of short-term financing sold by corporations,such as Raytheon,that mature from 1 to 270 days from the date of issue.

Secured bonds are backed by a specific pledge of company assets.

Which of the following financial institutions is organized as a not-for-profit cooperative?

Underwriting is the process used by insurance companies to determine whom to insure and what to charge.

A ______ is a time deposit at a financial institution,such as a commercial bank,savings bank,or credit union.

Funds can be transferred between savers and users in two ways: ________________.

The U.S.Department of Treasury sells what type of bonds?

Deposit insurance means that,in the event the bank fails,depositors are paid in full by the FDIC,up to $250,000.

In the U.S.financial system,which of the following is a net saver?

The Changing Face of Business

Business Ethics and Social Responsibility

Economic Challenges Facing Todays Business

Competing in World Markets

Forms of Business Ownership and Organization

Starting Your Own Business: the Entrepreneurship Alternative

Management,leadership,and the Internal Organization

Human Resource Management: From Recruitment to Labor Relations

Top Performance Through Empowerment, teamwork, and Communication

Production and Operations Management

Customer-Driven Marketing

Product and Distribution Strategies

Promotion and Pricing Strategies

Using Technology to Manage Information

Understanding Accounting and Financial Statements

Financial Management

Trends in E-Commerce

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Exam 16: The Financial System

An owner of which form of stock would receive dividend payments first?

M1 consists of currency in circulation and balances in bank checking accounts.

Life insurance companies tend to invest excess funds in short-term securities,while pension funds tend to invest excess funds in long-term securities.

All of the following are included in M1 EXCEPT __________.

As market interest rates rise,bond prices fall.

Preferred stockholders receive fixed dividends.

Municipal bonds are exempt from interest payments of federal income tax.

Municipal bonds are bonds issued by the federal government.

Operating under severe recessionary conditions,the Federal Reserve System decides to reduce its reserve requirements from the current level of 9% to 7.5%.Which of the following is likely to happen following the Fed's move?

______ is a form of short-term financing sold by corporations,such as Raytheon,that mature from 1 to 270 days from the date of issue.

Secured bonds are backed by a specific pledge of company assets.

Which of the following financial institutions is organized as a not-for-profit cooperative?

Underwriting is the process used by insurance companies to determine whom to insure and what to charge.

A ______ is a time deposit at a financial institution,such as a commercial bank,savings bank,or credit union.

Funds can be transferred between savers and users in two ways: ________________.

The U.S.Department of Treasury sells what type of bonds?

Deposit insurance means that,in the event the bank fails,depositors are paid in full by the FDIC,up to $250,000.

In the U.S.financial system,which of the following is a net saver?

The Changing Face of Business

Business Ethics and Social Responsibility

Economic Challenges Facing Todays Business

Competing in World Markets

Forms of Business Ownership and Organization

Starting Your Own Business: the Entrepreneurship Alternative

Management,leadership,and the Internal Organization

Human Resource Management: From Recruitment to Labor Relations

Top Performance Through Empowerment, teamwork, and Communication

Production and Operations Management

Customer-Driven Marketing

Product and Distribution Strategies

Promotion and Pricing Strategies

Using Technology to Manage Information

Understanding Accounting and Financial Statements

Financial Management

Trends in E-Commerce

Filters