Business 001 - Introduction to Business » Spring 2022 » Ch 15 OpenStax Homework
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Question #1
Ruth Hu recently inherited $200,000. She has invested the inherited money in real estate and government securities. Hu is using her money as a:
A.
measure of value
B.
commodity of exchange
C.
medium of exchange
D.
store of value
E.
measure of wealth
Question #2
For a college student who needs to buy an $80 textbook, the money she received from her parents for the purchase of school supplies would be used as a:
A.
measure of value
B.
measure of wealth
C.
commodity of exchange
D.
store of value
E.
medium of exchange
Question #3
The U.S. money supply is composed of:
A.
currency, demand deposits, and checking accounts
B.
stocks, demand deposits, and checking accounts
C.
currency, demand deposits, and time deposits
D.
checking accounts, bonds, and savings accounts
E.
coins, paper money, and treasury bills
Question #4
_____ is cash held in the form of coins and paper money.
A.
A time deposit
B.
Currency
C.
Revenue
D.
An account receivable
E.
Capital
Question #5
A checking account is also commonly referred to as a:
A.
federal deposit
B.
certificate of deposit
C.
demand deposit
D.
time deposit
E.
treasury account
Question #6
Money market deposit accounts and certificates of deposit are officially called ______ deposits.
A.
investor
B.
demand
C.
time
D.
diversified
E.
income
Question #7
Bo Riley pays his rent and utility bills each month by writing checks. Riley is using a _____ account.
A.
certificate of deposit
B.
currency
C.
federal deposit
D.
demand deposit
E.
time deposit
Question #8
_____ are deposits at a bank or other financial institution that pay interest but cannot be withdrawn on demand without penalty.
A.
Time deposits
B.
Commercial deposits
C.
Demand deposits
D.
Checking accounts
E.
Marketable securities
Question #9
Hal Silverstein has a savings account, also called a _____, at his local credit union.
A.
time deposit
B.
credit deposit
C.
demand deposit
D.
storage deposit
E.
marketable securities
Question #10
Credit cards:
A.
are used as a substitute for cash and checks
B.
defer payment to a later point in time
C.
do not replace money
D.
are accurately described by all of these
E.
are sometimes referred to as plastic money
Question #11
The most important function of the Federal Reserve System is carrying out ______ policy.
A.
fiscal
B.
tax
C.
inflationary
D.
spending
E.
monetary
Question #12
Which of the following is an activity performed by the Federal Reserve System as it carries out its monetary policy?
A.
loaning money to consumers
B.
insuring credit card balances
C.
controlling the stock exchange
D.
distributing currency
E.
providing tax refunds
Question #13
The three principal tools of the Federal Reserve System are:
A.
tax rate, margin requirements, and discount rate
B.
reserve requirements, consumer rate, and prime rate
C.
discount rate, prime rate, and open market operations
D.
open market operations, discount rate, and tax rate
E.
reserve requirements, discount rate, and open market operations
Question #14
The most frequently used and the most flexible tool that the Federal Reserve has that it can use to change the economic environment is:
A.
discount rate
B.
reserve requirement
C.
open market operations
D.
prime rate
E.
general fund deposits
Question #15
The purchase or sale of U.S. government bonds by the Federal Reserve to stimulate or slow down the economy is called:
A.
a prime transaction
B.
making a general fund deposit/withdrawal
C.
a base market operation
D.
manipulating the discount rate
E.
an open market operation
Question #16
To stimulate the economy, the Federal Reserve can:
A.
sell government bonds on the open market
B.
raise the discount rate
C.
lower the reserve requirement
D.
buy stocks listed on the New York Stock Exchange
E.
raise the prime rate
Question #17
Federal Reserve banks must hold a certain portion of their deposits in reserve. This percentage is called the:
A.
interest rate average
B.
prime monetary percentage
C.
discount requirement
D.
margin requirement
E.
reserve requirement
Question #18
When The Bank of Bank County borrows funds from the Federal Reserve; the rate the Fed charges the commercial bank is called the _____ rate.
A.
discount
B.
going
C.
prime
D.
reserve
E.
commercial bank
Question #19
In its role as lender to member banks, the Federal Reserve is called the:
A.
banker's bank
B.
customized bank
C.
national bank
D.
government exchange
E.
national creditor
Question #20
The power the Federal Reserve has to control credit terms on some loans made by banks and other lending institutions is called ______ controls.
A.
secure credit
B.
interbank feedback
C.
selective debit
D.
selective credit
E.
demand credit
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