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






2. 30 year maturities but not since 2001






3. Allowing consumers to time their purchases better.






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






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






6. The central bank






7. Relationship among yields of different maturities of hte same type of security.






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






9. 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.






10. Rare






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






12. Praises rising at a fast and furious pace






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






14. (Nominal) Interest Rate that is adjusted for expected changes in the price level. The more accurately reflects true cost of borrowing.






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






16. 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.






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






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






19. 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)






20. 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.






21. No interest- rate risk

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22. 2 -5 -10 year maturities






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






24. Precious Metals or another valueable commodity






25. 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

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






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






28. The over the counter market. Equity shares offered by companies that don't meet listing requirements for major stock exchanges - or choose not to be listed there - and instead are traded in decentralized markets.






29. The percent of available labor force unemployed






30. 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.






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






32. 4 -13 -26 -52 week maturities. Sold at zero coupon rates






33. Long-Term Debt and Equity Instruments






34. Instrumental in moving funds between countries






35. Excess liquidity is spent on goods and services






36. If short-term interest rates are low than the yield curve slopes...






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






38. Many lead to more employment and output






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






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






41. They have a higher interest-rate risk.






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






43. Alters publics liquidity and influences spending through portfolio adjustment






44. 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.






45. 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.






46. It will shift it to the right.






47. Yields similar for all maturities






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






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






50. 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.