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






2. A share of ownership in a corporation






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






4. The percent of available labor force unemployed






5. 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.






6. Intermediate Yields are highest






7. Nominal interest rate is not adjusted for inflation.






8. Short-Term Debt Instruments






9. Determines interest rates






10. The return expected over the next period on one asset relative to the alternative asset.






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






12. Held for one- ten years.






13. Praises rising at a fast and furious pace






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






15. Paper currency - has no real value






16. No interest- rate risk

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






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






19. Long-Term Debt and Equity Instruments






20. 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.






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






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






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






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






25. 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.






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






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






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






29. Foreign currencies deposited in banks outside the home country.






30. Comparing payoffs at different points in time






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






32. The central bank






33. 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.






34. 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.






35. Alters publics liquidity and influences spending through portfolio adjustment






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






37. Lower the equilibrium price and interest rate.






38. 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.






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






40. 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.






41. More than 10 year maturities






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






43. It will shift it to the right.






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






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






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






47. Many lead to more employment and output






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






49. When interest rates are high relative to past rates - investors expect them to decline and the prices of bonds to rise in the future resulting in big capital gains. Investors would then favor long term securities which drives up price and lowers yiel






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






Can you answer 50 questions in 15 minutes?



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