Question 1

The "Yes - Markets Self-Adjust" camp believes that

Accepted Answer

A)  banks' tension between prudence and profits contributes to business cycles. 
B)  money gives people a way not to spend. 
C)  money's store-of-value function contributes to business cycles. 
D)  money helps markets adjust to equilibrium. 
E)  money blocks the transmission mechanism between interest rates and aggregate demand. 
A)  banks' tension between prudence and profits contributes to business cycles. 
B)  money gives people a way not to spend. 
C)  money's store-of-value function contributes to business cycles. 
D)  money helps markets adjust to equilibrium. 
E)  money blocks the transmission mechanism between interest rates and aggregate demand. D

Question 2

Which is a recognized function of money?

Accepted Answer

A)  unit of exchange 
B)  medium of store 
C)  store of exchange 
D)  unit of account 
E)  medium of value 
A)  unit of exchange 
B)  medium of store 
C)  store of exchange 
D)  unit of account 
E)  medium of value D

Question 3

Liquidity is the

Accepted Answer

A)  opportunity cost of holding bonds. 
B)  ease of converting money into bonds. 
C)  price of money. 
D)  opportunity cost of holding money. 
E)  state of being sober. 
A)  opportunity cost of holding bonds. 
B)  ease of converting money into bonds. 
C)  price of money. 
D)  opportunity cost of holding money. 
E)  state of being sober. A

Question 4

In a world where Say's Law always holds true, which function of money seems crazy?

Accepted Answer

A)  medium of value 
B)  medium of exchange 
C)  store of value 
D)  store of exchange 
E)  unit of account 
A)  medium of value 
B)  medium of exchange 
C)  store of value 
D)  store of exchange 
E)  unit of account

Question 5

The monetary transmission mechanism describes how the impact of money is transmitted to real GDP.

Accepted Answer

A) True 
 B)False

Question 6

When the money supply decreases, bond prices

Accepted Answer

A)  rise and the price of money falls. 
B)  fall and the price of money falls. 
C)  rise and interest rates rise. 
D)  rise and interest rates fall. 
E)  fall and interest rates rise. 
A)  rise and the price of money falls. 
B)  fall and the price of money falls. 
C)  rise and interest rates rise. 
D)  rise and interest rates fall. 
E)  fall and interest rates rise.

Question 7

Bonds offer a(n)

Accepted Answer

A)  uncertain stream of payments and a fixed time period. 
B)  uncertain stream of payments and a fixed price. 
C)  fixed stream of payments and a fixed time period. 
D)  uncertain stream of payments and an uncertain price. 
E)  fixed stream of payments and an uncertain price. 
A)  uncertain stream of payments and a fixed time period. 
B)  uncertain stream of payments and a fixed price. 
C)  fixed stream of payments and a fixed time period. 
D)  uncertain stream of payments and an uncertain price. 
E)  fixed stream of payments and an uncertain price.

Question 8

When Vladimir sells bonds and gets money, his liquidity

Accepted Answer

A)  decreases and he gives up interest. 
B)  increases and he gives up interest. 
C)  decreases and he gains interest. 
D)  increases and he gains interest. 
E)  and interest do not change. 
A)  decreases and he gives up interest. 
B)  increases and he gives up interest. 
C)  decreases and he gains interest. 
D)  increases and he gains interest. 
E)  and interest do not change.

Question 9

The interest rate is the opportunity cost of holding money.

Accepted Answer

A) True 
 B)False

Question 10

According to the "No - Markets Self-Fail Often" camp, money affects external supply shocks that are the main source of business cycles.

Accepted Answer

A) True 
 B)False

Question 11

When the money supply decreases, interest rates fall and bond prices rise.

Accepted Answer

A) True 
 B)False

Question 12

Lower interest rates are a negative demand shock.

Accepted Answer

A) True 
 B)False

Question 13

Through the domestic monetary transmission mechanism, lower interest rates cause

Accepted Answer

A)  inflation and decreased unemployment. 
B)  deflation and increased unemployment. 
C)  deflation and decreased unemployment. 
D)  inflation and increased unemployment. 
E)  none of the above. 
A)  inflation and decreased unemployment. 
B)  deflation and increased unemployment. 
C)  deflation and decreased unemployment. 
D)  inflation and increased unemployment. 
E)  none of the above.

Question 14

Through the domestic monetary transmission mechanism, lower interest rates cause

Accepted Answer

A)  increased real GDP and decreased unemployment. 
B)  decreased real GDP and increased unemployment. 
C)  increased real GDP and increased unemployment. 
D)  decreased real GDP and decreased unemployment. 
E)  increased real GDP and no change in unemployment. 
A)  increased real GDP and decreased unemployment. 
B)  decreased real GDP and increased unemployment. 
C)  increased real GDP and increased unemployment. 
D)  decreased real GDP and decreased unemployment. 
E)  increased real GDP and no change in unemployment.

Question 15

When the price level rises, the demand curve for money shifts leftward.

Accepted Answer

A) True 
 B)False

Question 16

As a unit of account, money allows you to easily see the relative prices of all products and services.

Accepted Answer

A) True 
 B)False

Question 17

According to the "Yes - Markets Self-Adjust" camp, money allows savings to flow easily through the loanable funds market to facilitate business borrowing for investment spending.

Accepted Answer

A) True 
 B)False

Question 18

Canadian dollar bills used to be convertible into gold, but now are valuable simply because the government says they are.

Accepted Answer

A) True 
 B)False

Question 19

Debit cards are an example of deposit money.

Accepted Answer

A) True 
 B)False

Question 20

When Vladimir uses money to buy bonds, his liquidity

Accepted Answer

A)  decreases and he gives up interest. 
B)  increases and he gives up interest. 
C)  decreases and he gains interest. 
D)  increases and he gains interest. 
E)  and interest do not change. 
A)  decreases and he gives up interest. 
B)  increases and he gives up interest. 
C)  decreases and he gains interest. 
D)  increases and he gains interest. 
E)  and interest do not change.

The "Yes - Markets Self-Adjust" camp believes that

Which is a recognized function of money?

Liquidity is the

In a world where Say's Law always holds true, which function of money seems crazy?

The monetary transmission mechanism describes how the impact of money is transmitted to real GDP.

When the money supply decreases, bond prices

Bonds offer a(n)

When Vladimir sells bonds and gets money, his liquidity

The interest rate is the opportunity cost of holding money.

According to the "No - Markets Self-Fail Often" camp, money affects external supply shocks that are the main source of business cycles.

When the money supply decreases, interest rates fall and bond prices rise.

Lower interest rates are a negative demand shock.

Through the domestic monetary transmission mechanism, lower interest rates cause

Through the domestic monetary transmission mechanism, lower interest rates cause

When the price level rises, the demand curve for money shifts leftward.

As a unit of account, money allows you to easily see the relative prices of all products and services.

According to the "Yes - Markets Self-Adjust" camp, money allows savings to flow easily through the loanable funds market to facilitate business borrowing for investment spending.

Canadian dollar bills used to be convertible into gold, but now are valuable simply because the government says they are.

Debit cards are an example of deposit money.

When Vladimir uses money to buy bonds, his liquidity

Whats in Economics for You Scarcity, Opportunity Cost, Trade, and Models

Making Smart Choices: the Law of Demand

Show Me the Money: the Law of Supply

Coordinating Smart Choices: Demand and Supply

Are Your Smart Choices Smart for All Macroeconomics and Microeconomics

Up Around the Circular Flow: Gdp, Economic Growth, and Business Cycles

Costs of Not Working and Living: Unemployment and Inflation

Skating to Where the Puck Is Going: Aggregate Supply and Aggregate Demand

Trading Dollars for Dollars Exchange Rates and Payments With the Rest of the World

Steering Blindly Monetary Policy and the Bank of Canada

Spending Others Money: Fiscal Policy, Deficits, and National Debt

Are Sweatshops All Bad Globalization and Trade Policy

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Exam 9: Money Is for Lunatics: Demanders and Suppliers of Money

The "Yes - Markets Self-Adjust" camp believes that

Which is a recognized function of money?

Liquidity is the

In a world where Say's Law always holds true, which function of money seems crazy?

The monetary transmission mechanism describes how the impact of money is transmitted to real GDP.

When the money supply decreases, bond prices

Bonds offer a(n)

When Vladimir sells bonds and gets money, his liquidity

The interest rate is the opportunity cost of holding money.

According to the "No - Markets Self-Fail Often" camp, money affects external supply shocks that are the main source of business cycles.

When the money supply decreases, interest rates fall and bond prices rise.

Lower interest rates are a negative demand shock.

Through the domestic monetary transmission mechanism, lower interest rates cause

Through the domestic monetary transmission mechanism, lower interest rates cause

When the price level rises, the demand curve for money shifts leftward.

As a unit of account, money allows you to easily see the relative prices of all products and services.

According to the "Yes - Markets Self-Adjust" camp, money allows savings to flow easily through the loanable funds market to facilitate business borrowing for investment spending.

Canadian dollar bills used to be convertible into gold, but now are valuable simply because the government says they are.

Debit cards are an example of deposit money.

When Vladimir uses money to buy bonds, his liquidity

Whats in Economics for You Scarcity, Opportunity Cost, Trade, and Models

Making Smart Choices: the Law of Demand

Show Me the Money: the Law of Supply

Coordinating Smart Choices: Demand and Supply

Are Your Smart Choices Smart for All Macroeconomics and Microeconomics

Up Around the Circular Flow: Gdp, Economic Growth, and Business Cycles

Costs of Not Working and Living: Unemployment and Inflation

Skating to Where the Puck Is Going: Aggregate Supply and Aggregate Demand

Trading Dollars for Dollars Exchange Rates and Payments With the Rest of the World

Steering Blindly Monetary Policy and the Bank of Canada

Spending Others Money: Fiscal Policy, Deficits, and National Debt

Are Sweatshops All Bad Globalization and Trade Policy

Filters