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Test your basic knowledge |
DSST Money Banking And Central Banking
Start Test
Study First
Subjects
:
dsst
,
banking
Instructions:
Answer 32 questions in 15 minutes.
If you are not ready to take this test, you can
study here
.
Match each statement with the correct term.
Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.
This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. The amount of money in circulation
Financial Intermediaries
Liquidity
Standard of Deferred Payment
Money Supply
2. Propose discount rates - hold reserves and lend them through the discount window - furnish currency - collect and clear checks for banks and handle the U.S government debt and cash balances.
Liabilities
Federal Reserve Banks
Central Bank
Moral Hazard
3. Information possessed by one party in financial transaction but not by the other party.
Money Multiplier
Federal Open Market Committee
Unit of Accounting
Asymmetric Information
4. A system in which depository institutions hold reserves that are less that the amount of total deposits.
Fractional Reserve Banking
Liquidity
M1
Unit of Accounting
5. Amount owed; all items to which a business or household hold legal claim.
M1
Assets
Liquidity
Moral Hazard
6. Amounts owed; the legal claims against a business or household by nonowners.
Barter
Liabilities
Financial Intermediaries
Transactions Deposits
7. Any item the sellers will accept as payment.
Medium of Exchange
Potential Money Multiplier
Transactions Deposits
M2
8. Small-Denomination time-deposits - saving deposits and money market funds.
Money
Depository Institutions
What are the three items the belong exclusively to M2?
Board of Governors
9. The possibilty that a borrower might engage in riskier behavior after a loan has been obtained.
Moral Hazard
Transactions Deposits
Store of Value
M1
10. A banker's bank - usually an official institution that also serves as a bank for a nation's government treasury - Central Banks normally regulate commercial banks.
Federal Open Market Committee
Barter
Asymmetric Information
Central Bank
11. A board of governors and 5 reserve bank presidents that direct open market operations-buying and selling existing U.S Government securities.
Medium of Exchange
Reserves
Federal Open Market Committee
Federal Reserve Banks
12. A property of an item that makes it desirable for use as a means of settling debts maturing in the future; an essential property of money.
Standard of Deferred Payment
Medium of Exchange
M2
Reserves
13. Any medium that is universally accepted in an economy both by sellers of goods and services as payment for those goods and services and by creditors as payment for debts.
Unit of Accounting
Money
Thrift Institutions
Assets
14. The ability to hold value over time; a necessary property of money.
Medium of Exchange
Store of Value
Fiduciary Monetary System
Liquidity
15. 1/reserve ratio
Liquidity
Reserves
Potential Money Multiplier
Financial Intermediation
16. A measure by which prices are expressed;the common denominator of the price system; a central property of money.
Moral Hazard
Asymmetric Information
Reserves
Unit of Accounting
17. Institutions that transfer funds between ultimate lenders (savers) and ultimate borrowers.
Central Bank
Fractional Reserve Banking
Money Supply
Financial Intermediaries
18. The money supply - measured as the total value of currency + transactions deposits +traveler's checks not issued by banks.
M1
Board of Governors
Liquidity
Unit of Accounting
19. The degree to which an asset can be acquired or disposed of without much danger of any intervening loss in nominal value and with small transaction costs. Money is the most liquid asset.
M2
Liquidity
Unit of Accounting
Assets
20. Includes everything in M1 and Savings Deposits - small-denomination time deposits - and money market mutual funds.
Financial Intermediaries
Board of Governors
M2
What is more liquid: Old Master Paintings or Transaction Deposits?
21. In the U.S Federal Reserve System - deposits held by Federal reserve District banks for depository institutions - plus depository instituitions' vault cash.
Reserves
Store of Value
Potential Money Multiplier
Thrift Institutions
22. The process by which financial institutions accept savings from businesses - households - and governments and lend the savings to other businesses - households - and governments.
Medium of Exchange
Liabilities
Financial Intermediation
Store of Value
23. A system in which money is issued by the government and its value is based uniquely on the public's faith that the currency represents command over goods and services.
Standard of Deferred Payment
Liabilities
Fiduciary Monetary System
Money Supply
24. A method of measuring the money supply by looking at money as a medium of exchange.
Barter
Asymmetric Information
Potential Money Multiplier
Transactions Approach
25. Financial institutions that accept deposits from savers and lend funds from those deposits out at interest.
Fiduciary Monetary System
M2
Depository Institutions
Money Supply
26. A method of measuring the money supply by looking at money as a temporary store of value.
Depository Institutions
Fiduciary Monetary System
Liquidity Approach
Fractional Reserve Banking
27. The direct exchange of goods and services for other goods and services other goods and services without the use of money.
Money Supply
Liabilities
Asymmetric Information
Barter
28. A number that when multiplied by a change in the reserves in the banking system - yields a resulting change in the money supply.
Barter
Potential Money Multiplier
Liquidity Approach
Money Multiplier
29. Transaction Deposits
What is more liquid: Old Master Paintings or Transaction Deposits?
M1
Thrift Institutions
Barter
30. Checkable and debitable account balances in commercial banks and other types of financial institutions - such as credit unions and savings banks. Any accounts in financial institutions from which you can easily transmit debit-card and check payments
Transactions Deposits
Store of Value
Liquidity
Fiduciary Monetary System
31. 7 appointed members that set reserve requirements - approve discount rates - supervises and regulates member banks - and oversee Federal Reserve Banks
Financial Intermediation
Board of Governors
Fractional Reserve Banking
Reserves
32. Financial institutions that receive most of their funds from the savings of the public. They include savings banks - savings and loan associations - and credit unions.
Medium of Exchange
Fiduciary Monetary System
Central Bank
Thrift Institutions