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DSST Money And Banking

Subjects : dss, bankingt
Instructions:
  • Answer 50 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. Bond denominated in a currency other than that of the country in which it is sold.






2. (Nominal) Interest Rate that is adjusted for expected changes in the price level. The more accurately reflects true cost of borrowing.






3. The rate at which money circulates and the number of times the average dollar bill changes hands in a given time period






4. 2 -5 -10 year maturities






5. Reduces adverse selection - moral hazard - and insider trading.






6. Producing an efficient allocation of capital - which increases production






7. The degree of uncertainty associated with the return on one asset relative to alternative assets.






8. What kind of movements should we pay attention to in money supply numbers?






9. Yields similar for all maturities






10. Bought at price below face value and face value repaid at maturity






11. Principal plus interest paid to lender at given maturity date






12. Used to measure value in the economy






13. Allows transfer of funds from person or business without investment opportunities to one who has them - improves economic efficiency.






14. Held ten years or more. They pay semiannual dividends and return of principal at maturity.






15. Alters publics liquidity and influences spending through portfolio adjustment






16. More than 10 year maturities






17. The relationship between yield and maturity is...






18. Foreign currencies deposited in banks outside the home country.






19. Promotes economic efficiency by minimizing the time spent in exchanging goods and services






20. The upward and downward movement of aggregate output produced in the economy.






21. Most Common






22. Held for one- ten years.






23. Take the form of promissory notes - drafts - checks - and CDs






24. Periods of declining aggregate output - unemployment high - investment is low.






25. Precious Metals or another valueable commodity






26. Praises rising at a fast and furious pace






27. Commodity Money - Fiat Money - Checks - Electronic Payment - E-Money






28. Investors are concerned about the after tax return on bonds






29. Higher default risk compared to municipal Bonds






30. 4 -13 -26 -52 week maturities. Sold at zero coupon rates






31. Interest rate that equates today's value with present value of all future payments.






32. Real interest rate: the real interest rate people expect at the time they buy a bond or tax out a loan.






33. A debt security that promises to make payments periodically for a specified period of time.






34. The central bank






35. One to Ten year maturities which fund long-term capital investments






36. Yield curves most always...






37. Paper currency - has no real value






38. Flow of earnings per unit of time






39. A bank loan typically used by a company to finance storage or shipment of goods. This bank draft is like a check - and guarantees future payment. These securities are active in the Secondary Market

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40. Negotiable in secondary market and can also be resold in the secondary market. Minimum purchase of $100 -000 but the minimum in the secondary market is $2 -000 -000.






41. How interest rates on bonds of different maturities move over time






42. Graphical relationship of the yield on bonds with differing terms to maturity but the same risk - liquidity and tax considerations.






43. 30 year maturities but not since 2001






44. Prices of Long-Term securities are more volatile possibly suffer Capital Loss if owner needs to sell security prior to maturity. Prefer to hold Short-term securities for liquidity. Suggests Long term rates will always be higher than short term.






45. Markets bonds - loans - and deposits denominated in the currency of a given nation but held and traded outside that nations borders.






46. Real interest rate: the real interest rate actually realized.






47. Pays owner of bond a fixed payment - until maturity when it pays off face par value






48. Lower transaction costs - reduce risk - asymmetric information.






49. The percent of available labor force unemployed






50. The return expected over the next period on one asset relative to the alternative asset.







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