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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. Rare






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






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






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






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






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






7. Praises rising at a fast and furious pace






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






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






10. What will investors expect for taking on higher default risk?






11. A share of ownership in a corporation






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






13. Alters publics liquidity and influences spending through portfolio adjustment






14. Used to measure value in the economy






15. Less than one year and service current liquidity needs






16. 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.






17. At lower prices (higher i) - ceteris paribus - the quantity demanded of bonds is higher- an inverse relationship ' ' the quantity supplied of bonds is lower- a positive relationship.






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






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






20. Yields similar for all maturities






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






22. 30 year maturities but not since 2001






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






24. They have a higher interest-rate risk.






25. Comparing payoffs at different points in time






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






27. Influence on business cycle - inflation - interest rates






28. Banks borrow from and lend to each other deposits they hold at the Fed. These are very short term and usually only held over night.






29. Excess liquidity is spent on goods and services






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






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






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






33. Higher default risk compared to municipal Bonds






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






35. Short-Term Debt Instruments






36. 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.






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






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






39. Nominal interest rate is not adjusted for inflation.






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






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






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






43. Bond denominated in a currency other than that of the country in which it is sold.






44. Long-Term Debt and Equity Instruments






45. Allowing consumers to time their purchases better.






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






47. 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.






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






49. The central bank






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







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