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 wealth
B.
store of value
C.
commodity of exchange
D.
medium of exchange
E.
measure of value
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.
store of value
C.
measure of wealth
D.
medium of exchange
E.
commodity of exchange
Question #3
The U.S. money supply is composed of:
A.
currency, demand deposits, and time deposits
B.
stocks, demand deposits, and checking accounts
C.
checking accounts, bonds, and savings accounts
D.
coins, paper money, and treasury bills
E.
currency, demand deposits, and checking accounts
Question #4
_____ is cash held in the form of coins and paper money.
A.
Capital
B.
A time deposit
C.
Currency
D.
An account receivable
E.
Revenue
Question #5
A checking account is also commonly referred to as a:
A.
demand deposit
B.
federal deposit
C.
treasury account
D.
time deposit
E.
certificate of deposit
Question #6
Money market deposit accounts and certificates of deposit are officially called ______ deposits.
A.
investor
B.
demand
C.
diversified
D.
time
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.
time deposit
C.
federal deposit
D.
currency
E.
demand deposit
Question #8
_____ are deposits at a bank or other financial institution that pay interest but cannot be withdrawn on demand without penalty.
A.
Checking accounts
B.
Time deposits
C.
Marketable securities
D.
Commercial deposits
E.
Demand deposits
Question #9
Hal Silverstein has a savings account, also called a _____, at his local credit union.
A.
marketable securities
B.
storage deposit
C.
credit deposit
D.
demand deposit
E.
time deposit
Question #10
Credit cards:
A.
do not replace money
B.
are used as a substitute for cash and checks
C.
defer payment to a later point in time
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.
inflationary
C.
monetary
D.
spending
E.
tax
Question #12
Which of the following is an activity performed by the Federal Reserve System as it carries out its monetary policy?
A.
providing tax refunds
B.
loaning money to consumers
C.
insuring credit card balances
D.
distributing currency
E.
controlling the stock exchange
Question #13
The three principal tools of the Federal Reserve System are:
A.
reserve requirements, discount rate, and open market operations
B.
discount rate, prime rate, and open market operations
C.
open market operations, discount rate, and tax rate
D.
reserve requirements, consumer rate, and prime rate
E.
tax rate, margin requirements, and discount rate
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.
open market operations
C.
prime rate
D.
general fund deposits
E.
reserve requirement
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.
an open market operation
E.
manipulating the discount rate
Question #16
To stimulate the economy, the Federal Reserve can:
A.
buy stocks listed on the New York Stock Exchange
B.
lower the reserve requirement
C.
sell government bonds on the open market
D.
raise the prime rate
E.
raise the discount rate
Question #17
Federal Reserve banks must hold a certain portion of their deposits in reserve. This percentage is called the:
A.
margin requirement
B.
prime monetary percentage
C.
reserve requirement
D.
interest rate average
E.
discount 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.
commercial bank
D.
prime
E.
reserve
Question #19
In its role as lender to member banks, the Federal Reserve is called the:
A.
national creditor
B.
government exchange
C.
banker's bank
D.
customized bank
E.
national bank
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.
selective debit
B.
demand credit
C.
secure credit
D.
interbank feedback
E.
selective credit
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