chapters 11 and 15 test review

Chapters 11 and 15 Test Review

Questions made by students

Chapter 11 -- Money

Questions made by students

Which was not once a form of currency?

A. Wampum B. Silver C. Salt D. Grass

What is a characteristic of money?

A. Portability B. Durability C. Divisibility D. All of the above

What is a barter economy?

A. A man named Barter that started an economy

B. Economy based on trading C. Economy based on banking D. Moneyless economy that relies on

trading

Which is NOT a characteristic of money?

A. Durability B. Unlimited availability C. Portability D. Divisibility

What is a medium of exchange?

A. Place where money is traded B. Something accepted by everyone

for goods and services C. A type of currency D. All of the above

Gold certificates were issued in

A. 1886 B. 1863 C. 2002 D. 600 B.C.

What is an advantage of the gold and silver standards?

A. Value of gold is not fixed B. Prevents the gov’t from printing

too much money C. Gold stock could not keep up with

growth D. Shoe laces

There were about __ currencies before we had a national currency.

A. 8,000 B. 9,000 C. 10,000 D. 11,000

When was the Euro put into circulation?

A. 1992 B. 2000 C. 1999 D. 2002

An asset is

A. What the bank owes B. What the bank owns C. Money that can be loaned D. Money that can’t be loaned

When was the first known coin minted?

A. 500 B.C. B. 600 B.C. C. 900 B.C. D. 800 B.C.

Money is

A. Medium of exchange B. Measure of value C. Store of value D. All of the above

The characteristics of money include the following EXCEPT:

A. Durability B. Acceptability C. Portability D. Divisibility

The common denominator that can used to express worth

A. Measure of value B. Store of value C. Medium of exchange D. Barter economy

Which of the following is an advantage of the gold and silver standard?

A. Value of gold is not fixed B. Gold stock could not keep up with

the economy C. Portability D. People felt secure

Currency is made up of

A. Bills B. Coins C. Leaves D. Both A and B

Which of the following is not a characteristic of money?

A. Limited availability B. Divisibility C. Portability D. Transferability

Which characteristic of money “makes change?”

A. Portability B. Divisibility C. Durability D. Limited availability

Liabilities are

A. The percent of money that can’t be loaned

B. What the bank owes C. Money that can’t be loaned D. A potatoe

When was the Euro put into circulation?

A. 1992 B. 2000 C. 1999 D. 2002

What prevented wampum from being used more?

A. They broke easily B. People painted them black to be

considered more valuable C. They were easily stolen D. The supply ran short

Chapter 15 – The Federal Reserve

Questions made by students

Who sets the discount rate?

A. RB B. BoG C. FOMC

The Fed can expand or contract the money supply by influencing the cost of credit is called

A. Monetary policy B. Prime rate C. Discount rate D. Easy money policy

What is the required reserve?

A. Used to loan each other in the FFR B. Amount of money the banks have

to keep in the vault C. Money that can be loaned D. The interest rates banks charge

each other for overnight loans

What is the prime rate?

A. .25 B. .5 C. 3 D. 3.25

What is the policy the Fed uses to make the money supply grow?

A. Tight money policy B. Hard money policy C. Easy money policy D. Loose money policy

The window of last resort for banks. Banks do not like to use it.

A. Discount rate B. Free rate C. Window rate D. Federal funds rate

The Board of Governors has ? members.

A. 12 B. 25 C. 7 D. 5

The FFR is currently

A. .25 B. .50 C. 3.25 D. 10

What is a tight money policy used for?

A. To reduce inflation B. Make people borrow more C. Lower interest rates D. Make the money supply grow

Who can VOTE in the FOMC?

A. 7 members of the BoG, NY pres. and 4 rotating bank pres

B. 5 members of BoG, LA pres. and 3 rotating bank pres

C. 3 members of the BoG, NY pres. and 2 rotating bank pres

D. 8 members of the BoG, CA pres. and 4 rotating bank pres

There are ___ RBs.

A. 5 B. 7 C. 12 D. 25

The Federal Reserve was created in

A. 1945 B. 1860 C. 1913 D. 2002

Which of the following is not part of the FED?

A. FOMC B. Congress C. BoG D. Reserve Banks

What is the money multiplier?

A. rr/1 B. 3/rr C. 1/er D. 1/rr

Writes regulation for the Federal Reserve?

A. FOMC B. RB C. BoG D. none of the above

How does the FED expand or contract the money supply?

A. by printing more or less money B. by influencing the cost of credit C. by borrowing money from China D. it cannot influence the money

supply

The interest rate banks charge their most credit worthy members:

A. savings multiplier B. prime rate C. discount rate D. federal funds rate