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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. The relationship between yield and maturity is...






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






3. Most Common






4. 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)






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






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






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






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






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






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






11. Higher default risk compared to municipal Bonds






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






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






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






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






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






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






18. Rare






19. More than 10 year maturities






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






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






23. Precious Metals or another valueable commodity






24. Praises rising at a fast and furious pace






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






26. 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.






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






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






29. If the short-term interest rates are high than the yield curve slopes?






30. Long-Term Debt and Equity Instruments






31. Alters publics liquidity and influences spending through portfolio adjustment






32. A share of ownership in a corporation






33. They have a higher interest-rate risk.






34. Reduces adverse selection - moral hazard - and insider trading.






35. Yield curves most always...






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






37. The central bank






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






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






40. Supply and demand concept for different maturities will establish the specific rates for each maturity range. Changes in supply and demand can cause the rates to get out of line with expectations. However investors will drop preferred habitat if rate






41. 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.






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






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






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






45. Held for one- ten years.






46. Seller will buy back the asset at a later date and typically at a higher price. These securities are usually government securities and are used by banks and Large Corporations.






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






48. 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.






49. 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.






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