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WorksheetsTRẮC NGHIỆM TÀI CHÍNH TIỀN TỆ
Total questions: 50
Worksheet time: 4hrs 10mins
It is believed that Central banks are first set up to serve the role of:
The government's bank to stabilize its domestic economy.
The government's bank to finance war.
The banker's bank to issue notes to everyone.
The banker's bank to finance investments.
Central bank is the natural place for inter-bank payments to be settled for all the following reasons, EXCEPT:
This is a legally requirement in international practice.
All banks have their accounts at the central bank
To ensure the reliability and transparency of all transactions.
This has become a common practice for all banks.
The earliest central banks were mostly recorded in which region?
Africa
Asia
Amerrica
Europe
A credit market instrument that pays the owner a fixed coupon payment every year until the maturity date and then repays the face value is called a
Simple Loan
Fixed-payment loan
Counpon Bond
Discount Bond
According to the Simple model of Multiple Deposit Creation: if the required reserve ratio is 10%, the deposit multiplier is
10
100
1
0.1
.... is the total collection of a person's property while ..... is used to make purchases.
Wealth; income
Money; income
Income; money
Wealth; money
Fed uses ........... to control the maximum interest rate and ............. to control the minimum interest rate on the market for reserves.
Discount rate/interest rate paid on excess reserves
Interest rate paid on excess reserves/ discount rate
Federal fund rate/ discount rate
Discount rate/ Federal fund rate
Choose one correct example of "direct finance":
An insurance company buys shares of common stock in the over-the-counter markets.
People buy shares in a mutual fund.
People buy shares in a mutual fund.
A corporation issues new shares of stock
In an open market operation purchase (e.g. Fed buys bonds from a bank): banking system's reserves ............ and the monetary base ...............
Decrease/ increases
Increase/ increases
Decrease/ Decreases
Increase/ Decrease
When someone buys ......., that person will own a portion of a company and may get the right to vote on important issues (like management election).
Bills
Stock
Notes
Bonds
The evolution of the payment system through different methods to make payment as well as forms of money can be best understood as the result of:
Government regulations designed to promote the safety of the payments system
Competition among firms to make it easier for customers to purchase their products
Government regulations designed to improve the efficiency of the payments system
Innovations that reduced the costs of exchanging goods and services
Central bank is the natural place for inter-bank payments to be settled for all the following reasons, EXCEPT:
This is a legally requirement in international practice
All banks have their accounts at the central bank
To ensure the reliability and transparency of all transactions
This has become a common practice for all banks
The people who run central banks should not be politicians.
To avoid conflict of interest
Because of politician's limited understanding about finance
To better assign jobs for those who qualified
Because polician's term of service is only a few year
Keynes assumed that money has………………….rate of return.
A positive
A negative
A zero
An increasing
The market where equity instruments are traded is called
Money
Bond
Capital
Commodities
The risk that interest payments will not be made, or that the face value of a bond is not repaid when a bond matures is
Interest rate risk
Inflation risk
Moral hazard
Default risk
The present value of an expected future payment_____as the interest rate increases
Falls
Rises
Is constant
Is unaffected
A medium of exchange is
Something that is generally acceptable in exchange for goods and services
A legally recognized asset that is generally accepted in exchange for goods and services
Something that circulates and provides a standardized means of evaluating the relative price of goods and service
The ability of money to command purchasing power in the future
During a recession, output declines resulting in
lower unemployment in the economy.
higher unemployment in the economy
no impact on the unemployment in the economy.
higher wages for the workers.
Banks acquire the funds that they use to purchase income-earning assets from such sources as………….
cash items in the process of collection
savings accounts
reserves
deposits at other banks
Choose the correct statement from the following regarding features of debt and equity instruments:
Bond holders are residual claimants
The income from bonds is typically more variable than that from equities
Bonds pay dividends.
They can both be long-term financial instruments
When an individual deposits currency into his/her bank account: the bank's reserves ................ and the monetary ..............
remain unchanged/ fall
rise/ remains unchanged
remain unchanged/ rises
fall/ remains unchanged
Equities are generally ...... than bonds, as the corporation must pay all of its ....... before ..... paying its .........
safer/equity holders/debt holders
riskier/debt holders/equity holders
riskier/equity holders/debt holders
safer/debt holders/equity holders
Financial institutions can .......... thanks to their economies of scale:
Reduce transactions costs
Avoid adverse selection problems
Avoid the asymetric information problem
Reduce moral hazard
If the Federal fund rate is ........... the excess-reserves-interest rate, then an open market purchase will .......... the quantity of reserves and the Federal fund rate will.........
Equal to/increase/ decrease
Equal to/increase/ remain unchanged
higher than/ decrease/ decrease
higher than/ increase/ increase
In Keynes's liquidity preference framework, individuals are assumed to hold their wealth in two forms:
real assets and financial assets
stocks and bonds
money and bonds
money and gold
If you transfer $1,000 from your savings account to your checking account:
M1 decreases by $1,000, and M2 increases by $1,000.
M1 increases by $1,000, and M2 decreases by $1,000.
M1 and M2 don't change.
M1 increases by $1,000, but M2 doesn't change.
M2 decreases by $1,000, but M1 doesn’t change.
Choose one example for direct finance
You take out a mortage from your local bank
You borrow 50 million VND from a friend
You buy shares of common stock in the secondary market
You buy shares in a mutual fund
In a financial crisis: an unanticipated ............. in the price level causes the real burden of debt on borrowing firms to ............ .
increase/rise
decrease/rise
increase/fall
decrease/fall
Banks' borrowings from Federal Reserve are called ................ and represent a ................ of funds
Discount loans/use
Fed funds/source
Fed funds/use
Discount loans/source
When a central bank provides more discount loans to banks, the monetary base ................ and banking's reserves ................
Remains unchanged/ increase
Increases/ increase
Remains unchanged/ decrease
Decreases/ Decrease
In Keynesʹs Liquidity Preference Theory: demand for money is ............. related to .............
Negatively/ wealth
Positively/ interest rates
Negatively/ interest rates
Negatively/ income
Price of universal materials …………, making businesses to ……………, leading to ……….. inflation.
Increases/produce less/ cost - push
Decreases/produce more/ cost - pull
Increases/sell less/ cost - push
Decreases/ sell more/ cost - pull
Which one is not a function of intermediation?
It facilitates the acquisition of payment for goods and services
It eases the liquidity constraints of households and firms
It facilitates the creation of a portfolio
It provides a safekeeping service for those with excess funds
Among ......... members of the FOMC, ........... are from the Board of Governors, .............. are from Rederal Reserve Banks.âe
12/5/7
9/6/3
12/7/5
9/3/6
The monthly wage of someone is his/her:
Liabilities
Money
Income
Wealth
Reducing risk through the purchase of assets whose returns do not always move together is ……………………
diversification.
intermediation.
intervention
intervention
The Fisher’s Quantity Theory of Money begins with an identity known as the…………………..
demand for money
theory of asset demand
real money balances
equation of exchange
Choose the correct example of short-term debt instrument
A Treasury bond
A thirty-year mortgage
A sixty-month car loan.
A six month loan from a finance company
Among the followings, which is classified as liabilities in balance sheet of a bank:
Loans
Reserves
U.S Treasury securities
Discount loans
An increase in the monetary base that goes into ............... is not multiplied, while an increase that goes into ................ can be multiplied.
deposits / currency
currency / deposits
currency / excess reserves
excess reserves / currency
A____ is bought at a price below its face value, and the ____ value is repaid at the maturity date.
Coupon bond; discount
discount bond; discount
coupon bond; face
discount bond; face
The sum of the Fedʹs monetary liabilities and the U.S. Treasuryʹs monetary liabilities is called:
the money supply
currency in circulation.
bank reserves.
the monetary base.
The functions of money are
medium of exchange and unit of account
medium of exchange, unit of account, and store of value
medium of account and store of value
store of value and unit of account
Money is used as a unit of account, this
reduces the number of prices that need to be calculated.
increases transaction costs
does not earn interest.
discourages specialization
Choose the most correct evolution of the payment system:
Barter, checks, paper currency, electronic funds transfers
Barter, coins made of precious metals, paper currency, checks, electronic funds transfers
Barter, checks, paper currency, coins made of precious metals, electronic funds transfers
Barter, coins made of precious metals, checks, paper currency, electronic funds transfers
An investment bank purchases securities from a Corporation at a predetermined price and then resells them in the market. This process is called………………….
underwriting.
underhanded
understanding
undertaking.
Arrange the following assets from the most liquid to the least liquid:
house; savings bonds; currency
savings bonds; house; currency
currency; house; saving bonds
currency; saving bonds; house
The velocity of money can be explained as:
the ratio of the money stock to high-powered money set by the central bank
the ratio of the money stock to interest rates
the average number of times a dollar is spent in buying financial assets for a given firm in a given period of time
the average number of times that a dollar is spent in buying the total amount of final goods and services
The central and organized place where secondary market participants trade securities is called:
over-the-counter market
common market
exchange
barter market
