TEST 4(all)

# TEST 4(all) - TEST 4 User ID skim7 Attempt 1 1 Out of 100...

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TEST 4 User ID: skim7 Attempt: 1 / 1 Out of: 100 Started: November 23, 2004 9:56pm Finished: November 23, 2004 11:39pm Time spent: 1 hr, 43 min., 16 sec. Student finished 1 hr, 16 min., 44 sec. ahead of the 180 min. time limit. Question 1 (2 points) If we were to rank the three types of money from the largest measure to the smallest, we would have the ordering Student response: Percent Value Correct Response Student Response Answer Choices 0.0% a. M1, M2, M3. 100.0% b. M3, M2, M1. 0.0% c. All are equal. 0.0% d. They cannot be ranked, because they measure different things. Score: 2 / 2 Question 2 (2 points) One common problem with commodity money is that Student response: Percent Value Correct Response Student Response Answer Choices 0.0% a. it has little intrinsic value. 0.0% b. it is not useful as a unit of account. 100.0% c. it may not be divisible. 0.0% d. gold is in short supply. Score: 2 / 2 Question 3 (2 points) From the definitions of M1 and M2, we know that Student response: Percent Value Correct Response Student Response Answer Choices 0.0% a. M1 is always larger than M2. 100.0% b. M2 is always larger than M1. 0.0% c. M1 and M2 are always equal. 0.0% d. M1 is sometimes larger than M2, and sometimes smaller than M2. Score: 2 / 2 Question 4 (2 points)

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The definition of M2 includes which of the following types of money? Student response: Percent Value Correct Response Student Response Answer Choices 100.0% a. Travelers' checks 0.0% b. Eurodollar deposits 0.0% c. Stocks 0.0% d. Repurchase agreements Score: 2 / 2 Question 5 (2 points) When the demand for money exceeds the supply, Student response: Percent Value Correct Response Student Response Answer Choices 0.0% a. more money will be printed to meet the demand. 100.0% b. the interest rate will rise. 0.0% c. the interest rate will fall. 0.0% d. inflation will decrease. Score: 0 / 2 Question 6 (2 points) If income decreases, which of the following will occur? Student response: Percent Value Correct Response Student Response Answer Choices 0.0% a. Money supply will shift left. 100.0% b. Money demand will shift left. 0.0% c. The interest rate will increase. Score: 0 / 2 Question 7 (2 points) If the money supply increases, then interest rates will rise. Student response: Percent Value Correct Response Student Response Answer Choices 0.0% a. True 100.0% b. False Score: 2 / 2
Question 8 (2 points) The graph below shows the demand for money. The initial interest rate is io. Which graph correctly depicts a rise in interest rates above the initial level io? Student response: Percent Value Correct Response Student Response Answer Choices 0.0% a. 100.0% b. 0.0% c. 0.0% d. Score: 2 / 2 Question 9 (2 points) The graph below shows the demand for money. If the Federal Reserve has the power to set the money supply at a fixed level, we depict the money supply curve as a(n) Student response: Percent Value Correct Response Student Response Answer Choices 0.0% a. upward-sloping line that intersects the demand curve.

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