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






2. 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.






3. Used to measure value in the economy






4. Praises rising at a fast and furious pace






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






6. A bank loan typically used by a company to finance storage or shipment of goods. This bank draft is like a check - and guarantees future payment. These securities are active in the Secondary Market


7. 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.






8. More than 10 year maturities






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






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






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






12. Rare






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






14. They have a higher interest-rate risk.






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






16. 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.






17. Influence on business cycle - inflation - interest rates






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






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






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






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






22. Excess liquidity is spent on goods and services






23. Alters publics liquidity and influences spending through portfolio adjustment






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






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






26. 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)






27. 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.






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






29. Less than one year and service current liquidity needs






30. The central bank






31. Higher default risk compared to municipal Bonds






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






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






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






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






36. 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






37. Many lead to more employment and output






38. 2 -5 -10 year maturities






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






40. Long-Term Debt and Equity Instruments






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






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






43. Precious Metals or another valueable commodity






44. Intermediate Yields are highest






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






46. 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.






47. Greater incentive to borrow and less to lend.






48. Flow of earnings per unit of time






49. Lower the equilibrium price and interest rate.






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