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Fundamentals of Money & Banking Chapter Exam

Exam Instructions:

Choose your answers to the questions and click 'Next' to see the next set of questions. You can skip questions if you would like and come back to them later with the yellow "Go To First Skipped Question" button. When you have completed the practice exam, a green submit button will appear. Click it to see your results. Good luck!

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Question 1 1. What is the best explanation of monetary policy?

Question 2 2. Which of the following policies was NOT part of the Dodd-Frank Wall Street Reform and Consumer Protection Act?

Question 3 3. The money multiplier is a relationship between which two drivers?

Question 4 4.

When looking at the demand curve for money, which of the following completes this sentence?

When interest rates are 20%, the demand for money is _____.

Question 5 5. The government issues a new two-dollar and fifty cent bill. What is the intrinsic value of the new currency?

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Question 6 6. When GDP is rising, money demand will most likely

Question 7 7. Why does the Fed have an important role in managing the economy?

Question 8 8. Which one of the following institutions funds IPOs?

Question 9 9. Which of these is TRUE regarding money demand and price level?

Question 10 10. When a deposit is made into a bank, what does the bank do?

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Question 11 11. What does it mean if everything in an economy can be quoted in terms of money?

Question 12 12. Why would a business choose an Offshore Banking Center?

Question 13 13. How does the demand curve for money shift?

Question 14 14. What happens when there is an increase in the demand for money when the supply of money is unchanged?

Question 15 15. A bank gets a demand deposit of $50,000. If the reserve requirement is 10%, what is the maximum the bank can loan out at this time?

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Question 16 16. Why are the advances in banking technology potentially a negative for the consumer?

Question 17 17. Which of the following was NOT a cause of the financial crisis of 2008?

Question 18 18. Under fractional banking, when a bank lends to a customer, which of the following happens?

Question 19 19. Which one of the following banking transactions cannot be accomplished online?

Question 20 20. Why was money created?

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Question 21 21. Money that has an intrinsic value is called what?

Question 22 22. Money serves as a standard of deferred payment when:

Question 23 23. Which one of the following is a way people can conduct banking transactions?

Question 24 24. When $1,000 gets deposited into the banking system, and the reserve ratio is 10%, what is the most the money supply could increase?

Question 25 25. How does an affiliate bank and a subsidiary bank differ?

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Question 26 26. What is the economics model that describes the demand and supply of money in a nation called?

Question 27 27. How can the government use fiscal policy to stimulate the economy in a financial crisis?

Question 28 28. $10,000 gets deposited into the Ceelo First National Bank. As a result, excess reserves go up by $8,000. This means that the required reserve ratio must be:

Question 29 29. Assume that the reserve requirement is 25%. If banks have excess reserves of $10,000, which of the following is the maximum amount of additional money that can be created by the banking system through the lending process?

Question 30 30. How does inflation prevent most of the money in use today from serving as a pure store of value?

Fundamentals of Money & Banking Chapter Exam Instructions

Choose your answers to the questions and click 'Next' to see the next set of questions. You can skip questions if you would like and come back to them later with the yellow "Go To First Skipped Question" button. When you have completed the practice exam, a green submit button will appear. Click it to see your results. Good luck!

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