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WorksheetsBanks and the money supply
Total questions: 8
Worksheet time: 4mins
The money in your UK bank account is all money created by the Bank of England.
True
False
Which of the following are functions of investment banks? Select three answers.
Accepting cash deposits
Providing day-to-day payment facilities for firms
Providing large amounts of bespoke finance for firms
Advising and negotiating mergers and acquisitions
Trading in bonds and equities (capital market activities)
Which of these is not a common function of a high street bank?
Short term loans to firms and customers
Safe place to deposit cash
Payments systems such as credit and debit cards
Advising and managing private equity funds (funds that buy stakes in businesses)?
Which of these would be counted as an asset on the balance sheet of a retail/commercial/high street bank? (3 correct)
Cash in vaults
Deposits at the Bank of England
Loans to firms and households
The total value of deposits by customers
Shareholder capital (money from shareholders)
If banks, on average, hold 25% of their deposits in reserve, what is the size of the money multiplier?
(a)
Which of these assets are the most liquid?
Loans to customers
Cash and reserves at the Bank of England
Government and corporate securities
What proportion of this bank's total liabilities are held in reserves?
10
20
30
90
A 'run on the bank' occurs when
Depositors want to withdraw more money than can be paid out
The value of a bank's assets in loans and securities plummet
The Central Bank implements a reserve requirement
