exam 1 a-2

exam 1 a-2 - MULTIPLE CHOICE Choose the one alternative...

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MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) In the Baumol-Tobin analysis, the transactions demand for money is 1) _______ A) not related to the level of income. B) not related to the expected return on other assets. C) negatively related to the level of interest rates. D) only A and B of the above. 2) While legislation enacted in 1998 granted the Bank of Japan new powers and greater autonomy, its critics 2) _______ A) contend that its independence is too great because it need not pursue a policy of price stability even if that is the popular will of the people. B) contend that its independence is limited by the Ministry of Finance's veto power over a portion of its budget. C) contend that its independence is limited since the Ministry of Finance can dismiss senior bank officials. D) contend that its independence is too great since the Ministry of Finance no longer has veto power over the bank's budget. E) none of the above. 3) The many regional Federal Reserve banks resulted from a compromise between parties favoring 3) _______ A) a private central bank and those favoring a government institution. B) establishment of a central bank and those opposed to its establishment. C) establishment of the Board of Governors in Washington, D.C. and those preferring its establishment in New York City. D) none of the above. 4) Credit risk management tools include: 4) _______ A) collateral. B) compensating balances. C) restrictive covenants. D) all of the above. E) only A and B of the above. 5) The president from which Federal Reserve Bank always has a vote in the Federal Open Market Committee? 5) _______ A) New York B) Boston C) Philadelphia D) San Francisco 6) For the classical economists, the quantity theory of money provided an explanation of movements in the price level. Movements in the price level result 6) _______ A) primarily from changes in the quantity of money. B) from changes in factors other than the quantity of money. C) solely from changes in the quantity of money.
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This note was uploaded on 04/03/2008 for the course ECON 301 taught by Professor Hassan during the Spring '08 term at Rutgers.

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exam 1 a-2 - MULTIPLE CHOICE Choose the one alternative...

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