EOY economics

1. When someone buys something they are using money as--

• a medium of exchange.

• a store of value

• a measure of value.

• a fiat instrument

One of the advantages of a debit card is--

• you can buy things even if you don’t have money in the bank.

• it is the same as using cash.

• items you buy with it are insured.

• you can purchase items with pre-tax dollars.

If the economy were suffering from excessive inflation an appropriate monetary policy combination might include which of the following Federal Reserve tools?

• Raise the discount rate, increase the required reserve, and buy bonds.

• Raise the discount rate, increase the required reserve, and sell bonds.

• Lower the discount rate, increase the required reserve, and buy bonds.

• Lower the discount rate, increase the required reserve, and sell bonds.

One of the disadvantages of a credit card is--

• you may over extend yourself.

• your losses are unlimited in the event of theft of your card.

• you can accrue frequent flier miles.

• you must be 25 to get one.

Something that is used as money because the government says it is legal tender is called

• commodity money

• fiat money.

• representative money.

• legus tenderus.

If the economy were suffering from a recession an appropriate monetary policy combination might

include which of the following Federal Reserve tools?

• Raise the discount rate, increase the required reserve, and buy bonds.

• Raise the discount rate, increase the required reserve, and sell bonds.

• Lower the discount rate, lower the required reserve, and buy bonds

• Lower the discount rate, lower the required reserve, and sell bonds.

When the Federal Reserve follows expansionary policy the following chain of events occurs

• They increase the money supply, interest rates rise, businesses and consumers borrow less, and the economy grows.

• They increase the money supply, interest rates rise, businesses and consumers borrow more, and the economy grows.

• They increase the money supply, interest rates fall, businesses and consumers borrow less, and the economy grows.

• They increase the money supply, interest rates fall, businesses and consumers borrow more, and the economy grows.

The number of regional Federal Reserve banks on the United States is

• 1

• 12

• 25

• 2,500

What event marked a point in history when the government's role in the economy increased

substantially?

• the Revolutionary War

• the Reagan presidency

• World War I

• the New Deal

Supporters of the fiscal policy believe that unemployment can be reduced by--

• increasing taxes or reducing government spending.

• decreasing taxes or increasing government spending.

• increasing trade.

• decreasing trade.