Econ Chapter 3 Review Game

What did banks issue before we had paper currency?

• banknotes

• credit cards

• commodities

• stocks

What is fiat money?

• Money backed by a physical commodity like gold

• Money that has value because a government maintains it

• Money that is used only in digital transactions

• Money that is issued by private corporations

Explain the concept of a bank holding reserves and its importance in the banking system.

• It ensures banks can meet withdrawal demands

• It allows banks to invest in high-risk ventures

• It is used to calculate interest rates

• It is a form of government taxation

How does a mutual fund work?

• It pools money from many investors to purchase stocks and bonds

• It is a savings account with a fixed interest rate

• It is a type of insurance policy

• It is a loan given to a corporation

What is the role of the Federal Reserve in the banking system?

• It sets the prices of all goods and services

• It regulates the money supply and banking

• It provides loans to individual consumers

• It manages the stock market

What is a Certificate of Deposit (CD)?

• A timed-savings account with a fixed interest rate

• A type of mutual fund

• A government bond

• A corporate stock

What is the primary difference between stocks and bonds?

• Stocks represent debt from a loan, while bonds represent ownership

• Stocks represent ownership, while bonds represent debt from a loan

• Stocks are issued by governments, while bonds are issued by corporations

• Stocks have fixed interest rates, while bonds do not

Which of the following is considered the least risky investment?

• Sports betting

• Stocks

• Government bonds

• Corporate bonds

If someone is worried about a major downturn in the economy, how can they protect their investments?

• focus mostly on stocks

• focus mostly on bonds

• focus on both stocks and bonds equally

• stop investing

A large corporation that owns several brands across different markets and industries is known as a:

• partnership

• deficit corporation

• conglomerate

• franchise