Fin 308 test 1 answer key

96 level easy multiple choice questions 11 the

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Unformatted text preview: B) C) D) E) Introduction Changing reserve requirements Devaluing the currency Changing bank regulations Open market operations Answer: E Page: 99 Level: Easy 12. The Federal Reserve System is charged with A) Regulating securities exchanges B) Conducting monetary policy C) Providing payment and other services to a variety of institutions D) Setting bank prime rates E) Both B and C Answer: E Page: 89 Level: Easy Saunders, Financial Markets and Institutions, 2/e 27 13. The _______________ is a nationwide network that electronically process credit and debit transfers of funds. A) Fedwire B) ACH C) CHIPS D) NASDAQ E) SWIFT Answer: B Page: 92 Level: Easy 14. The _____________ is a network linking over 6000 banks with the Federal Reserve that is used to transfer deposits and make loan payments between participants. A) Fedwire B) ACH C) CHIPS D) NASDAQ E) SWIFT Answer: A Page: 92 Level: Easy 15. Ceteris paribus, if the Fed was targeting the quantity o f money supplied and money demand dropped the Fed would likely ______________. If the Fed was instead targeting interest rates and money demand dropped the Fed would likely _______________. A) increase the money supply, do nothing. B) do nothing, decrease the money supply. C) decrease the money supply, do nothing. D) do nothing, increase the money supply. E) increase the money supply, decrease the money supply. Answer: B Page: 97 Level: Difficult 16. Which of the following is the major monetary policy making body of the U.S. FRS? A) FOMC B) OCC C) FRB bank presidents D) U.S. Congress E) Group of ten Answer: A Page: 99 Level: Easy 28 Saunders, Financial Markets and Institutions, 2/e Chapter 1 Introduction 17. The major liability of the Federal Reserve is A) U.S. Treasury securities B) Depository institution reserves C) Currency outside banks D) Vault cash of commercial banks E) Gold and foreign exchange Answer: C Page: 96 Level: Medium 18. The major asset of the Federal Reserve is A) U.S. Treasury securities B) Depository institution reserves C) Currency outside banks D) Vault cash of commercial banks E) Gold and foreign exchange Answer: A Page: 97-98 Level: Medium 19. Given the current economic conditions in Japan, the Bank of Japan is likely to engage in A) Contractionary monetary policy B) Expansionsary monetary policy C) Zero inflation monetary policy D) Fiscal spending to improve the economy E) Cutting the government budget deficit. Answer: B Page: 116 Level: Medium Response: The answer to this question may change as Japanese economic conditions change. 20. The fed funds rate is the rate that A) Banks charge for loans to corporate customers B) Banks charge to lend foreign exchange to customers C) The Federal Reserve charges on emergency loans to commercial banks D) Banks charge each other on loans of excess reserves E) Banks charge securities dealers to finance their inventory Answer: D Page: 98 Level: Medium Saunders, Financial Markets and Institutions, 2/e 29 21. The discount rate is the rate that A) Bank...
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This note was uploaded on 09/23/2013 for the course FIN 308 taught by Professor Spivey during the Fall '08 term at Clemson.

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