Cal State LA » Economics » Econ 3030 - Money, Banking and the Economy » Fall 2021

Question #1

Choose the party who worry least about asymmetric information

A. loan sharks

B. wells fargo

C. bank of america

D. federal credit union

Question #2

Which of the following has the shortest maturity?

A. Federal Funds

B. 10-year Treasury bond

C. perpetuity

D. real estate

Question #3

According to the Fisher Equation, the nominal interest is the real rate minus the inflation rate.

A. TRUE

B. FALSE

Question #4

As the Treasury reduces its bond buying program, or tapering, the prices of bonds will

A. go sideways

B. go up and then down

C. go down

D. go up

Question #5

What is the inverse relationship between bond prices and bond yields?

A. as prices go up, yields go down

B. as prices go up, yields go up

C. as prices go down, yields go down

Question #6

You are using a bank because __________.

A. you are charitable

B. you are forced to do it

C. it is convenient