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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. Yields similar for all maturities






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






3. Lower the equilibrium price and interest rate.






4. Praises rising at a fast and furious pace






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






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






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






8. Cost of borrowing money - expressed as a percentage of the amount borrowed per year.






9. Influence on business cycle - inflation - interest rates






10. It will shift it to the right.






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






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






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






14. Crucial role in creation of money






15. The percent of available labor force unemployed






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






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






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






19. Investors are concerned about the after tax return on bonds






20. They have a higher interest-rate risk.






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






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






23. 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.






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






25. 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.






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






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






28. Comparing payoffs at different points in time






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






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






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






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






33. 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.






34. Instrumental in moving funds between countries






35. Allowing consumers to time their purchases better.






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






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






38. 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)






39. Intermediate Yields are highest






40. 30 year maturities but not since 2001






41. Flow of earnings per unit of time






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






43. Precious Metals or another valueable commodity






44. Alters publics liquidity and influences spending through portfolio adjustment






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






46. Determines interest rates






47. Long-Term Debt and Equity Instruments






48. Banks borrow from and lend to each other deposits they hold at the Fed. These are very short term and usually only held over night.






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






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