Quiz Chapter 6
A nominal anchor promotes price stability by
keeping inflation expectations low.
keeping economic growth low.
stabilizing interest rates.
All else the same, when the Fed calls in a $100 disc
Quiz Chapter 1
Of the following assets, the least liquid is
Pieces of property that serve as a store of value are called
units of account.
Quiz Chapter 5
Which of the following bonds are considered to be default-risk free?
U.S. Treasury bonds
Which of the following can be described as involving indirect finance?
Quiz Chapter 4
What is the return on a 5 percent coupon bond that initially sells for $1,000 and sells for
$900 next year?
When I purchase _, I own a portion of a firm and have the r
Quiz Chapter 2
The interest rate that equates the present value of payments received from a debt
instrument with its value today is the
simple interest rate.
real interest rate.
yield to maturity.
Quiz Chapter 7
Everything else held constant, in the market for reserves, when the federal funds rate is
3%, lowering the interest rate paid on excess reserves rate from 2% to 1%
raises the federal funds rate.
has no effect on
Quiz Chapter 12
When a bank sells a government bond to the Federal Reserve, reserves in the banking
system _ and the monetary base _, everything else held constant.
Quiz Chapter 9
Individuals that lend funds to a bank by opening a checking account are called
Lower tariffs and quotas cause a country's currency to _ in the _ run,
Quiz Chapter 8
If the desired intermediate target is an interest rate, the preferred policy instrument
the federal funds rate.
the monetary base.
the discount rate.
If the requ
Quiz Chapter 10
The interest rate charged on overnight loans of reserves between banks is the
federal funds rate.
Treasury bill rate.
The monetary base consists of
reserves and Federal Reserve Notes.
Quiz Chapter 11
The strongest argument for an independent Federal Reserve rests on the view that
subjecting the Fed to more political pressures would impart
a countercyclical bias to monetary policy.
an inflationary bias to mo
Quiz Chapter 3
The risk structure of interest rates is
the relationship among interest rates of different bonds with the same maturity.
the structure of how interest rates move over time.
the relationship among interest rates