ch10 - ECON320 Chapter10PracticeTest ProfessorC.JamesHueng...

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ECON320 Chapter 10 Practice Test Professor C. James Hueng 1) Which of the following statements are true? A) A bank ʹ s liabilities are its sources of funds. B) A bank ʹ s balance sheet has the property that total assets equal the sum of total liabilities and equity capital. C) A bank ʹ s assets are its uses of funds. D) Each of the above are true. E) Only A and B of the above are true. 2) Which of the following statements is false? A) A bank issues liabilities to acquire funds. B) Bank capital is an asset in the bank balance sheet. C) A bank ʹ s assets are its uses of funds. D) The bank ʹ s assets provide the bank with income. 3) Which of the following are reported as liabilities on a bank ʹ s balance sheet? A) Cash items in the process of collection B) Discount loans C) State government securities D) All of the above E) Only A and B of the above 4) The share of checkable deposits in total bank liabilities has A) remained virtually unchanged since 1960. B) shrunk over time. C) expanded dramatically over time. D) expanded moderately over time. 5) Checkable deposits and money market deposit accounts are A) payable on demand. B) liabilities of the banks. C) assets of the banks. D) only A and B of the above. E) only A and C of the above. 6) Which of the following statements are true? A) Checkable deposits are payable on demand. B) Checkable deposits include NOW accounts. C) Checkable deposits are the primary source of bank funds. D) All of the above are true. E) Only A and B of the above are true. 7) Because checking accounts are _____ liquid for the depositor than passbook savings, they earn _____ interest rates. A) less; higher B) more; lower C) more; higher D) less; lower 8) Because time deposits are _____ liquid for the depositor than passbook savings, they earn _____ interest rates. A) more; higher B) more; lower C) less; higher D) less; lower 9) Bank capital is listed on the _____ side of the bank ʹ s balance sheet because it represents a _____ of funds. A) liability; source B) liability; use C) asset; source D) asset; use
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10) Bank loans from the Federal Reserve are called _____ and represent a _____ of funds. A) fed funds; use B) fed funds; source C) discount loans; source D) discount loans; use 11) Bank reserves include A) deposits at the Fed. B) vault cash. C) short - term Treasury securities. D) all of the above. E) both A and B of the above. 12) Which of the following are reported as assets on a bank ʹ s balance sheet? A) U.S. Treasury securities B) Loans C) Discount loans from the Fed D) Only A and B of the above 13) Which of the following are reported as assets on a bank ʹ s balance sheet? A) Cash items in the process of collection B) Deposits with other banks C) Bank capital D) Checkable deposits E) Only A and B of the above 14) Which of the following are not reported as assets on a bank ʹ s balance sheet? A) Checkable deposits
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This note was uploaded on 11/06/2010 for the course PHYSICS 1220 taught by Professor Yung during the Fall '09 term at Missouri (Mizzou).

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ch10 - ECON320 Chapter10PracticeTest ProfessorC.JamesHueng...

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