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






2. The percent of available labor force unemployed






3. Crucial role in creation of money






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






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






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






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






8. Many lead to more employment and output






9. 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.






10. 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.






11. They have a higher interest-rate risk.






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






13. 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.






14. A share of ownership in a corporation






15. 30 year maturities but not since 2001






16. Allowing consumers to time their purchases better.






17. Most Common






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






19. Excess liquidity is spent on goods and services






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






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






22. 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.






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






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






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






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






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






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






29. Long-Term Debt and Equity Instruments






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






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






32. The central bank






33. 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.






34. Used to measure value in the economy






35. Supply and demand concept for different maturities will establish the specific rates for each maturity range. Changes in supply and demand can cause the rates to get out of line with expectations. However investors will drop preferred habitat if rate






36. Instrumental in moving funds between countries






37. Nominal interest rate is not adjusted for inflation.






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






39. 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.






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






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






42. No interest- rate risk

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43. Precious Metals or another valueable commodity






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






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






46. Cost of borrowing money - expressed as a percentage of the amount borrowed per year.






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






48. Rare






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






50. More than 10 year maturities