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chapter 14 - Chapter 14 Money Interest Rates and Exchange...

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Chapter 14: Money, Interest Rates, and Exchange Rates Multiple Choice Questions 1. The exchange rate between currencies depends on A. the interest rate that can be earned on deposits of those currencies. B. the expected future exchange rate. C. the interest rate that can be earned on deposits of those currencies and the expected future exchange rate. D. national output. E. None of the above. Answer: B 2. Money serves as 3. Money includes A. currency. B. bank deposits on which check may be written. C. both A and B. D. travelers’ checks. E. A, B and D. Answer: E 4. In the United States at the end of 2000, the total money supply, M1, amounted to approximately
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5. Individuals base their demand for an asset on 6. The family summer house on Cape Code pays a return in the form of A. interest rate. B. capital gains. C. the pleasure of vacations at the beach. D. A, B and C. E. B and C only. Answer: E 7. In a world with money and bonds only, 8. Which one of the following statements is the most accurate?
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