Economics Unit 5 CFA

Economics Unit 5 CFA

5 Qs

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Economics Unit 5 CFA

Economics Unit 5 CFA

Assessment

Quiz

others

Hard

Created by

Inderpaul S Bhullar

FREE Resource

5 questions

Show all answers

1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Commercial banks can create money by
transferring depositors' accounts at the Federal Reserve for conversion to cash
buying Treasury bills from the Federal Reserve
sending vault cash to the Federal Reserve
maintaining a 100 percent reserve requirement
lending excess reserves to customers

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

If a central bank significantly increases its sales of government bonds, it is most likely responding to which of the following?
Slow economic growth
An appreciating domestic currency
Rising unemployment
Rising price levels
Rising imports and declining exports

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Assume that the reserve requirement is 20 percent. If a bank initially has no excess reserves and $10,000 cash is deposited in the bank, the maximum amount by which this bank may increase its loans is
$2,000
$8,000
$10,000
$20,000
$50,000

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which of the following accurately describes the federal funds rate?
The interest rate that banks charge state governments
The interest rate that banks charge other banks for overnight loans
The interest rate that banks pay on long-term savings
The interest rate on personal loans
The interest rate on government bonds

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

n the United States, which event would have caused the shift of the money supply curve from S1 to S2 in the money market shown above?
The purchase of government bonds on the open market by the Federal Reserve
An increase in the required reserve ratio
A short-run increase in output, employment, and income
An increase in general price level in the United States
An increase in the supply of dollars in foreign exchange markets