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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. Producing an efficient allocation of capital - which increases production






2. Yield to maturity; a measure of an interternporal price






3. Many lead to more employment and output






4. Praises rising at a fast and furious pace






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






6. Purchase financial assets which lowers interest rates which stimulates business investment and consumer spending






7. 30 year maturities but not since 2001






8. A dollar paid to you one year from now is less valueable than a dollar paid to you today






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






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






11. Nominal interest rate is not adjusted for inflation.






12. Lower excess demand and lower price will rise and interest rates will fall






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






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






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






16. Lower excess supply and lower price will fall and interest rates will rise






17. 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.






18. Currency + Traveler's Checks+ Demand Deposits + Other checkable deposits






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






20. Lower the equilibrium price and interest rate.






21. They channel funds from savers to investors - thereby promoting economic efficiency






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






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






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






25. Alters publics liquidity and influences spending through portfolio adjustment






26. The interest rate at which private depository institutions lend balances to other depository institutions usually over night






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






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






29. Less than one year and service current liquidity needs






30. The higher the default risk means the yield curve...






31. Medium of exchange; unit of account; store of value; increases the liquidity in the economy






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






33. When interest rates are high relative to past rates - investors expect them to decline and the prices of bonds to rise in the future resulting in big capital gains. Investors would then favor long term securities which drives up price and lowers yiel






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






35. Seller will buy back the asset at a later date and typically at a higher price. These securities are usually government securities and are used by banks and Large Corporations.






36. Rare






37. 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.






38. 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)






39. 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.






40. 4 -13 -26 -52 week maturities. Sold at zero coupon rates






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






42. It will shift it to the right.






43. Flow of earnings per unit of time






44. Yield curves most always...






45. 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.






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






47. Intermediate Yields are highest






48. 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.






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






50. Long-Term debt instruments of Corporations which are held 2-30 years. These securities have excellent credit ratings and pay interest two times a year and pay at maturity. These can be redeemed for shares of stock.