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.
medium of exchange
C.
store of value
D.
commodity 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.
store of value
B.
commodity of exchange
C.
measure of value
D.
measure of wealth
E.
medium of exchange
Question #3
The U.S. money supply is composed of:
A.
currency, demand deposits, and time deposits
B.
checking accounts, bonds, and savings accounts
C.
coins, paper money, and treasury bills
D.
stocks, demand deposits, and checking accounts
E.
currency, demand deposits, and checking accounts
Question #4
_____ is cash held in the form of coins and paper money.
A.
Revenue
B.
Capital
C.
A time deposit
D.
Currency
E.
An account receivable
Question #5
A checking account is also commonly referred to as a:
A.
treasury account
B.
certificate of deposit
C.
demand deposit
D.
time deposit
E.
federal deposit
Question #6
Money market deposit accounts and certificates of deposit are officially called ______ deposits.
A.
investor
B.
income
C.
time
D.
demand
E.
diversified
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.
federal deposit
C.
demand deposit
D.
currency
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_____ are deposits at a bank or other financial institution that pay interest but cannot be withdrawn on demand without penalty.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.
Checking accounts
B.
Commercial deposits
C.
Demand deposits
D.
Marketable securities
E.
Time deposits
Question #9
Hal Silverstein has a savings account, also called a _____, at his local credit union.
A.
credit deposit
B.
time deposit
C.
storage deposit
D.
marketable securities
E.
demand deposit
Question #10
Credit cards:
A.
are accurately described by all of these
B.
defer payment to a later point in time
C.
are sometimes referred to as plastic money
D.
are used as a substitute for cash and checks
E.
do not replace money
Question #11
The most important function of the Federal Reserve System is carrying out ______ policy.
A.
inflationary
B.
spending
C.
tax
D.
fiscal
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.
controlling the stock exchange
B.
insuring credit card balances
C.
providing tax refunds
D.
loaning money to consumers
E.
distributing currency
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.
open market operations, discount rate, and tax rate
D.
reserve requirements, discount rate, and open market operations
E.
discount rate, prime 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.
prime rate
B.
reserve requirement
C.
general fund deposits
D.
open market operations
E.
discount rate
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 base market operation
B.
an open market operation
C.
making a general fund deposit/withdrawal
D.
a prime transaction
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.
raise the discount rate
C.
lower the reserve requirement
D.
sell government bonds on the open market
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.
discount requirement
B.
reserve requirement
C.
margin requirement
D.
interest rate average
E.
prime monetary percentage
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.
commercial bank
B.
discount
C.
reserve
D.
going
E.
prime
Question #19
In its role as lender to member banks, the Federal Reserve is called the:
A.
national bank
B.
banker's bank
C.
government exchange
D.
national creditor
E.
customized 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.
demand credit
B.
selective credit
C.
selective debit
D.
interbank feedback
E.
secure credit
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