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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. The central bank






2. Relationship among yields of different maturities of hte same type of security.






3. Comparing payoffs at different points in time






4. Short-Term Debt Instruments






5. It will shift it to the right.






6. Lower Incentive to borrow but a greater incentive to lend.






7. The total collection of pieces of property that serve to store value






8. 4 -13 -26 -52 week maturities. Sold at zero coupon rates






9. Nominal interest rate is not adjusted for inflation.






10. No interest- rate risk

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






12. Anything that is generally accepted in payment for goods or services or in the repayment of debts; a stock concept






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






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






15. More than 10 year maturities






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






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






18. Used to measure value in the economy






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






20. Less than one year and service current liquidity needs






21. Used to save purchasing power; most liquid of all assets but loses value during inflation






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






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






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






25. The market for loanable funds: (or equivalently - the market for bonds) determines R. One-for-One






26. Crucial role in creation of money






27. Sold in a foreign country and denominated in that country's currency.






28. Yield curves most always...






29. For a commodity to function efficiently as money it must be...






30. Financial instruments whose return is based on the underlying returns on mortgage loans.






31. Small depository institutions report infrequently and adjustments must be made for seasonal variations






32. Lower the equilibrium price and interest rate.






33. Higher default risk compared to municipal Bonds






34. Bringing together of buyers and sellers of financial securities to establish prices; includes banks - savings and loans - credit unions - investment banks - and brokers - mutual funds - and bond markets.






35. Yields similar for all maturities






36. Restrictions on Entry - Restrictions on Assets and Activities - Disclosure - Deposit Insurance - Limits on competition - and restriction on interest rates.






37. The over the counter market. Equity shares offered by companies that don't meet listing requirements for major stock exchanges - or choose not to be listed there - and instead are traded in decentralized markets.






38. Fixed payment (incorporating part of the principal and interest payment) paid over a period of time






39. A rise in the price level causes the demand for money at each interest rates to increase and the demand curve to shift to the right.






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






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






42. Held for one- ten years.






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






44. If the short-term interest rates are high than the yield curve slopes?






45. 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.






46. Precious Metals or another valueable commodity






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






48. 30 year maturities but not since 2001






49. The increase in the price of set goods and services in a given economy over a period of time - the percent change.






50. Long-Term Debt and Equity Instruments