3229 Final - Cream - Spring 16 - 3229 SP2016 Final CREAM Name MULTIPLE CHOICE Choose the one alternative that best completes the statement or answers

3229 Final - Cream - Spring 16 - 3229 SP2016 Final CREAM...

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3229 SP2016 Final CREAM Name___________________________________ MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) Which investment bank avoided bankruptcy in 2008 by reorganizing itself as a bank holding company? A) Goldman Sachs B) Lehman Brothers C) Bear Stearns D) Merrill Lynch 2) The economist Irving Fisher, after whom the Fisher effect is named, explained why interest rates ________ as the expected rate of inflation ________, everything else held constant. 3) The primary difference between the "payoff" and the "purchase and assumption" methods of handling failed banks is 4) Everything else held constant, a decrease in the excess reserves ratio causes the M1 money multiplier to ________ and the money supply to ________. 5) When the central bank allows the purchase or sale of domestic currency to have an effect on the monetary base, it is called A) an exchange rate feedback rule. B) a money neutral foreign exchange intervention. C) a sterilized foreign exchange intervention. D) an unsterilized foreign exchange intervention. 6) In the simple deposit expansion model, if the Fed purchases $100 worth of bonds from a bank that previously had no excess reserves, deposits in the banking system can potentially increase by 7) If an individual moves money from a small-denomination time deposit to a demand deposit account 8) Under a fixed exchange rate regime, if a country has an ________ exchange rate, then its central bank's attempt to keep its currency from depreciating will result in a ________ of international reserves.
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