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






2. 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.






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






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






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






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






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






8. Nominal interest rate is not adjusted for inflation.






9. 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.






10. 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.






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






12. The total collection of pieces of property that serve to store value






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






14. 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.






15. Instrumental in moving funds between countries






16. No interest- rate risk

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17. 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.






18. The market for loanable funds: (or equivalently - the market for bonds) determines R. One-for-One






19. Most Common






20. Used to save purchasing power; most liquid of all assets but loses value during inflation






21. 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.






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






23. Lower Incentive to borrow but a greater incentive to lend.






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






25. The central bank






26. 30 year maturities but not since 2001






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






28. The percent of available labor force unemployed






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






30. Greater incentive to borrow and less to lend.






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






32. Excess liquidity is spent on goods and services






33. Many lead to more employment and output






34. Yield curves most always...






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






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






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






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






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






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






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






43. 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.






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






45. 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.






46. Praises rising at a fast and furious pace






47. Alters publics liquidity and influences spending through portfolio adjustment






48. Determines interest rates






49. Paper currency - has no real value






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