Money, Banking and Financial Markets: Homeschool Curriculum 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. Which of the following is a component of M1?

Question 2 2. 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?

Question 3 3. Assume that there are two parties to an exchange and that they value the goods they would receive as much as the goods they would give away. What do economists call this?

Question 4 4. Which of the following statements is true regarding the money supply?

Question 5 5. Samantha just celebrated her first holy communion. Her parents opened a savings account (that earns 3% interest) for her to deposit the money that was gifted to her on this special occasion. Samantha deposits the $400 from her party. What will that amount will be worth in exactly 1 year from now?

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Question 6 6. According to the T-account shown, if the required reserve ratio is 10%, what is the maximum amount of additional loans this bank can make?

Question 7 7. How do banks make money?

Question 8 8. As the price level decreases, how is the value of money impacted?

Question 9 9. How do banks make money?

Question 10 10. $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:

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Question 11 11. Tom is saving for a down payment on a new automobile. If he wants his savings account (which is earning a 5% interest rate) to be worth $5,000 in 3 years, how much money will he need to invest today?

Question 12 12. The money multiplier is a relationship between which two drivers?

Question 13 13. Which of these is TRUE regarding money demand and price level?

Question 14 14. How does the demand curve for money shift?

Question 15 15. When GDP is rising, money demand will most likely

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Question 16 16. Which of the following measures of the money supply is largest?

Question 17 17. Besides being known as the reserve ratio, what is the fraction of a customer's deposits that a bank is required to hold in reserve also called?

Question 18 18. The government issues a new two-dollar and fifty cent bill. What is the intrinsic value of the new currency?

Question 19 19. Which of the following BEST explains the contractual obligation associated with stock?

Question 20 20. What is the present value of a series of $50,000 payments for 10 years at an interest rate of 5% per year?

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Question 21 21. Under fractional banking, when a bank lends to a customer, which of the following happens?

Question 22 22. When money can be stored for a length of time and then used later to purchase goods and services, economists say that money is:

Question 23 23. Yvette is risk intolerant and does not want there to be much fluctuation in value for her assets. Which asset would Yvette most likely keep?

Question 24 24. Lydia deposits $70,000 into the First National Bank of Ceelo. The required reserve ratio is 10%. How much will the money supply increase if the bank loans out excess reserves?

Question 25 25. Money that has an intrinsic value is called what?

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Question 26 26. Money is a medium of exchange because:

Question 27 27. The time value of money teaches us that

Question 28 28. If banks have excess reserves of $5,000, and the money supply increased by $20,000, what is the reserve ratio?

Question 29 29. Loretta deposits money into her savings account. If all other factors are held constant, how does this affect M2?

Question 30 30. What happens when there is an increase in the demand for money when the supply of money is unchanged?

Money, Banking and Financial Markets: Homeschool Curriculum 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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