SUBJECTS
|
BROWSE
|
CAREER CENTER
|
POPULAR
|
JOIN
|
LOGIN
Business Skills
|
Soft Skills
|
Basic Literacy
|
Certifications
About
|
Help
|
Privacy
|
Terms
|
Email
Search
Test your basic knowledge |
DSST Money And Banking
Start Test
Study First
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. Expectations theory forms the foundation of the slope of the curve. Liquidity Premium Theory makes Long Term permanent modifications that suggests an up ward slopping curve. Over short periods - relatives supplies of securities have an impact on yiel
bond
hyperinflation
Term structure theory
role of money
2. A share of ownership in a corporation
common stock
Long-Term Maturities (Bond Market)
Tbonds
Short-Term Maturity
3. The increase in the price of set goods and services in a given economy over a period of time - the percent change.
Intermediate-term Maturity (Capital Market)
Coupon Bond
Yield Curve
inflation
4. Short-Term Debt Instruments
Bd > Bs
Money Market
Tbonds
Short-Term Maturity
5. Nominal interest rate is not adjusted for inflation.
Interest rate
Yield Curve
indirect impact
Real world obervations
6. Does not deal directly with the public and responsible for executing of the national monetary policy; implements policy by altering money supply and influencing bank behavior.
easily standardized - widely accepted - divisible and not deteriorate quickly
Flat yield curves
central bank
Use present value calculations
7. Comparing payoffs at different points in time
Keynesian Model
Yield on a Discount Basis
Use present value calculations
bond market (money markets)
8. Alters publics liquidity and influences spending through portfolio adjustment
increases in money supply causes
Tnotes
Money (money supply)
Ex Ante
9. Pays owner of bond a fixed payment - until maturity when it pays off face par value
Coupon Bond
Medium of Exchange
Income effect
Term Structure
10. 3 -6 -12 month securities with no explicit one payment and is sold at a discount. These securities are highly liquid - and can be traded in the secondary market. These are some of the safest securities.
interest rate
T-Bills
Eurobond
function of financial markets
11. Determines interest rates
bond market (money markets)
Bd < Bs
Yield Curve
Money Market
12. A debt security that promises to make payments periodically for a specified period of time.
unemployment rate
bond
Expected Return
foreign exchange market
13. Many lead to more employment and output
Bd > Bs
increasing money supply
M1
Long-Term Maturities (Bond Market)
14. Excess liquidity is spent on goods and services
direct impact
Expected Return
Yield to Maturity for simple loans
Capital Markets
15. Paper currency - has no real value
Fiat Money
T-Bonds
increasing money supply
Slope upward
16. The total collection of pieces of property that serve to store value
Medium of Exchange
Wealth
Evolution of the Payment System
hyperinflation
17. Yield to maturity; a measure of an interternporal price
The Liquidity Premium Modification
Foreign Bonds
Downward Slopes
Interest rate
18. The higher the default risk means the yield curve...
How Financial Markets directly improve the well-being of consumers
direct impact
Hs a greater upward shift
What will an increase in the money supply engineered by the Federal Reserve do to the supply curve for money?
19. Allowing consumers to time their purchases better.
How Financial Markets directly improve the well-being of consumers
Foreign Bonds
Why returns are more volatile for Long-Term bonds
Forms of Commercial Papers
20. Foreign currencies deposited in banks outside the home country.
financial markets
Eurocurrency
bond market (money markets)
Term structure theory
21. Real interest rate: the real interest rate actually realized.
Ex Ante
Ex Post
Function of Financial Intermediaries
Money Market
22. Greater incentive to borrow and less to lend.
inflation
interest rate
Eurobond
When real rate is low
23. Short-Term securities are very good substitutes for each other within investor's portfolios who collectively impact the market. There aren't separate markets for short-term and long-term securities - there is one single market.
Banker's Acceptance
The Expectation Approach
When real rate is low
who determines our money supply
24. It will shift it to the right.
T-Bills
What will an increase in the money supply engineered by the Federal Reserve do to the supply curve for money?
Ex Ante
Why Revisions are issued to money data
25. If short-term interest rates are low than the yield curve slopes...
Foreign Bonds
Upward
Bd > Bs
Commodity Money
26. When bond is at par - the yield equals the coupon rate. The price and yield are negatively related. The yield greater than coupon rate when bond price is below par.
Intermediate-term Maturity (Capital Market)
Foreign Bonds
Kind of risk for a bond that's maturity equals the holding period
Price vs Yields to Maturity
27. Bought at price below face value and face value repaid at maturity
Income
Bd < Bs
Discount (zero coupon) Bond
What will an increase in the money supply engineered by the Federal Reserve do to the supply curve for money?
28. What will investors expect for taking on higher default risk?
How Financial Markets promote economic efficiency
Higher Returns
Money Market
hyperinflation
29. Lower transaction costs - reduce risk - asymmetric information.
M1
Function of Financial Intermediaries
Downward Slopes
Coupon Bond
30. It determines the equilibrium interest rate in terms of the supply of land demanded for money . People store their wealth in money and bonds. If the market for money is in equilibrium (Ms=Md) then the bond markets are also in equilibrium (Bs=Bd)
Bd < Bs
Downward Slopes
Tnotes
Keynesian Model
31. Relationship among yields of different maturities of hte same type of security.
central bank
Why returns are more volatile for Long-Term bonds
Term Structure
business cycle
32. 4 -13 -26 -52 week maturities. Sold at zero coupon rates
Forms of Commercial Papers
Upward
Tnotes
T-Bills
33. A higher level of income causes the demand for money at each interest rate to increase and the demand curve to shift to the right.
Real world obervations
Income effect
Term Structure
Velocity
34. (Nominal) Interest Rate that is adjusted for expected changes in the price level. The more accurately reflects true cost of borrowing.
banks and money supply
Foreign Bonds
increasing money supply
Real Interest Rate
35. Fixed payment (incorporating part of the principal and interest payment) paid over a period of time
Fixed Payment-Loan
When real rate is low
hyperinflation
Banker's Acceptance
36. For a commodity to function efficiently as money it must be...
Fixed Payment-Loan
easily standardized - widely accepted - divisible and not deteriorate quickly
When real rate is high
Capital Markets
37. Financial instruments whose return is based on the underlying returns on mortgage loans.
Unit of Account
indirect impact
Mortgage-Backed Securities
Velocity
38. The degree of uncertainty associated with the return on one asset relative to alternative assets.
function of financial markets
Yield on a Discount Basis
Risk
Income
39. Lower the equilibrium price and interest rate.
Bd = Bs
Federal Funds Market
Long-Term Maturities (Bond Market)
Tbonds
40. The return expected over the next period on one asset relative to the alternative asset.
Long-Term Maturities (Bond Market)
Unit of Account
Expected Return
indirect impact
41. Precious Metals or another valueable commodity
T-Bills
Regulations increase information available to investors which does what?
Commodity Money
Money (money supply)
42. Anything that is generally accepted in payment for goods or services or in the repayment of debts; a stock concept
T-Bills
bond
Money (money supply)
direct impact
43. Take the form of promissory notes - drafts - checks - and CDs
Fiat Money
who determines our money supply
Forms of Commercial Papers
unemployment rate
44. Commodity Money - Fiat Money - Checks - Electronic Payment - E-Money
indirect impact
Evolution of the Payment System
Not constant
Keynesian Model
45. The upward and downward movement of aggregate output produced in the economy.
Unit of Account
Function of Financial Intermediaries
T-Notes
business cycle
46. Purchase financial assets which lowers interest rates which stimulates business investment and consumer spending
How Financial Markets promote economic efficiency
indirect impact
Discount (zero coupon) Bond
Eurobond
47. Flow of earnings per unit of time
role of money
Flat yield curves
Ex Post
Income
48. Bond denominated in a currency other than that of the country in which it is sold.
How Financial Markets directly improve the well-being of consumers
Eurobond
interest rate
central bank
49. No interest- rate risk
Warning
: Invalid argument supplied for foreach() in
/var/www/html/basicversity.com/show_quiz.php
on line
183
50. 2 -5 -10 year maturities
Why returns are more volatile for Long-Term bonds
easily standardized - widely accepted - divisible and not deteriorate quickly
Tnotes
Bd = Bs