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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. 2 -5 -10 year maturities






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






3. Most Common






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






5. Long-Term Debt and Equity Instruments






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






7. 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.






8. 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.






9. Alters publics liquidity and influences spending through portfolio adjustment






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. Praises rising at a fast and furious pace






12. Higher default risk compared to municipal Bonds






13. 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)






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






15. Paper currency - has no real value






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






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






18. Instrumental in moving funds between countries






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






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






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






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






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






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






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






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






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






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






29. Less accurate but is less difficult to calculate. It always understates the yield to maturity and becomes more severe the longer the maturity.






30. Influence on business cycle - inflation - interest rates






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






32. Used to measure value in the economy






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






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






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






36. 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.






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






38. Determines interest rates






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






40. Yield curves most always...






41. They have a higher interest-rate risk.






42. Intermediate Yields are highest






43. 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






44. Excess liquidity is spent on goods and services






45. Yields similar for all maturities






46. The central bank






47. Less than one year and service current liquidity needs






48. Many lead to more employment and output






49. A share of ownership in a corporation






50. 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.