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Worksheetsvixmoo p3
Total questions: 98
Worksheet time: 1hrs 14mins
You use VND currency to pay the owner of a restaurant for a delicious meal. The currency
has no intrinsic value. The exchange is an example of barter.
has no intrinsic value. The exchange is not an example of barter.
has intrinsic value. The exchange is not an example of barter.
has intrinsic value. The exchange is not an example of barter.
Which of the following is an example of barter?
A parent gives a teenager a $10 bill in exchange for her babysitting services.
A homeowner gives an exterminator a check for $50 in exchange for extermination services.
A barber gives a plumber a haircut in exchange for the plumber fixing the barber’s leaky faucet.
All of the above are examples of barter.
A double coincidence of wants
is required when there is no item in an economy that is widely accepted in exchange for goods and services.
is required in an economy that relies on barter.
is a hindrance to the allocation of resources when it is required for trade.
All of the above are correct.
Money
is more efficient than barter.
makes trades easier
allows greater specialization.
All of the above are correct.
Which of the following lists is included in what economists call “money”?
cash
cash and stocks and bonds
cash and stocks and bonds and real estate
cash and stocks and bonds and real estate and all other assets
Economists use the term “money” to refer to
all wealth.
all assets, including real assets and financial assets.
all financial assets, but not real assets.
those types of wealth that are regularly accepted by sellers in exchange for goods and services.
Which of the following is a function of money?
a unit of account
a store of value
medium of exchange
All of the above are correct.
Which of the following best illustrates the medium of exchange function of money?
You keep some money hidden in your shoe.
You keep track of the value of your assets in terms of currency.
You pay for your oil change using currency.
None of the above is correct.
Any item that people can use to transfer purchasing power from the present to the future is called
a medium of exchange.
a unit of account.
a store of value.
None of the above is correct.
Which of the following is a store of value?
cash and stocks
cash but not stocks
stocks but not cash
neither cash nor stocks
Which of the following is a store of value?
currency
U.S. government bonds
fine art
All of the above are correct.
Liquidity refers to
the ease with which an asset is converted to the medium of exchange.
the measurement of the intrinsic value of commodity money.
the measurment of the durability of a good.
how many time a dollar circulates in a given year.
Which list ranks assets from most to least liquid?
currency, fine art, stocks
currency, stocks, fine art
fine art, currency, stocks
fine art, stocks, currency
Which list ranks assets from most to least liquid?
money, bonds, cars, houses
money, cars, houses, bonds
bonds, money, cars, houses
bonds, cars, money, houses
Money is
the most liquid asset and a perfect store of value.
the most liquid asset but an imperfect store of value.
not the most liquid asset but a perfect store of value.
neither the most liquid asset and nor a perfect store of value
When we measure and record economic value, we use money as the
liquid asset.
medium of exchange
unit of account.
store of value.
Commodity money is
backed by gold.
the principal type of money in use today.
money with intrinsic value.
receipts created in international trade that are used as a medium of exchange.
If an economy uses silver as money, then that economy’s money
serves as a store of value but not as a medium of exchange.
serves as a medium of exchange but not as a unit of account.
is commodity money.
has no intrinsic value.
Fiat money
has no intrinsic value
is backed by gold.
is a medium of exchange but not a unit of account.
is any close substitute for currency such as checkable deposits.
Currently, VND is
fiat money with intrinsic value.
fiat money with no intrinsic value
commodity money with intrinsic value.
commodity money with no intrinsic value.
The primary difference between commodity money and fiat money is that
commodity money is a medium of exchange but fiat money is not.
fiat money is a medium of exchange but commodity money is not.
commodity money has intrinsic value but fiat money does not.
fiat money has intrinsic value but commodity money does not
Currency includes
paper bills and coins.
demand deposits.
credit cards.
Both (a) and (b) are correct.
People can write checks against
demand deposits and money market mutual funds
demand deposits but not money market mutual funds
money market mutual funds but not demand deposits
neither demand deposits nor money market mutual funds
Demand deposits are a type of
checking account.
time deposit.
money market mutual fund.
savings deposit.
The measure of the money stock called M1 includes
wealth held by people in their checking accounts.
wealth held by people in their savings accounts.
wealth held by people in money market mutual funds.
everything that is included in M2 plus some additional items.
M1 equals currency plus demand deposits plus
nothing else.
other checkable deposits.
traveler's checks plus other checkable deposits.
traveler's checks plus other checkable deposits plus savings deposits.
Which of the following is not included in M1?
a $5 bill in your wallet
$100 in your checking account
$500 in your savings account
All of the above are included in M1.
Which of the following items is included in M2?
credit cards
money market mutual funds
corporate bonds
large time deposits
Which of the following statements is correct?
All items that are included in M1 are included also in M2.
All items that are included in M2 are included also in M1.
Credit cards are included in both M1 and M2.
Savings deposits are included in both M1 and M2.
Which of the following is not included in either M1 or M2?
U.S. Treasury bills
small time deposits
demand deposits
money market mutual funds
Which of the following institutions is a central bank?
the Bank of Japan
the Bank of England
the Federal Reserve System
All of the above are correct.
The agency responsible for regulating the money supply in Vietnam is
the Comptroller of the Currency.
the Ministry of Finance.
the State Bank of Vietnam.
the GSO.
The central bank
is responsible for conducting the nation’s monetary policy, and it plays a role in regulating banks.
is responsible for conducing the nation’s monetary policy, but it plays no role in regulating banks
is not responsible for conducting the nation’s monetary policy, and it plays a role in regulating banks.
is not responsible for conducing the nation’s monetary policy, and it plays no role in regulating banks.
Which of the following does a central bank not do?
conduct monetary policy
act as a lender of last resort
convert VND into gold
serve as a bank regulator
Which of the following does a central bank not do?
It controls the supply of money.
It acts as a lender of last resort to banks.
It makes loans to any qualified business that requests one.
It tries to ensure the health of the banking system.
When conducting an open-market sale, central bank
buys government bonds, and in so doing increases the money supply.
buys government bonds, and in so doing decreases the money supply.
sells government bonds, and in so doing increases the money supply.
sells government bonds, and in so doing decreases the money supply.
When conducting an open-market purchase, central bank
buys government bonds, and in so doing increases the money supply.
buys government bonds, and in so doing decreases the money supply.
sells government bonds, and in so doing increases the money supply.
sells government bonds, and in so doing decreases the money supply.
An open-market purchase
increases the number of dollars and the number of bonds in the hands of the public.
increases the number of dollars in the hands of the public and decreases the number of bonds in the hands of the public
decreases the number of dollars and the number of bonds in the hands of the public.
decreases the number of dollars in the hands of the public and increases the number of bonds in the hands of the public.
In a system of 100-percent-reserve banking,
banks do not make loans.
currency is the only form of money.
deposits are banks’ only assets.
All of the above are correct.
In a system of 100-percent-reserve banking,
banks do not accept deposits.
banks do not influence the supply of money.
loans are the only asset item for banks.
All of the above are correct.
In a fractional-reserve banking system, a bank
does not make loans.
does not accept deposits.
keeps only a fraction of its deposits in reserve.
None of the above is correct.
Under a fractional-reserve banking system, banks
hold more reserves than deposits.
generally lend out a majority of the funds deposited.
cause the money supply to fall by lending out reserves.
All of the above are correct.
If a bank has a reserve ratio of 8 percent, then
government regulation requires the bank to use at least 8 percent of its deposits to make loans.
the bank’s ratio of loans to deposits is 8 percent.
the bank keeps 8 percent of its deposits as reserves and loans out the rest.
the bank keeps 8 percent of its assets as reserves and loans out the rest.
A bank’s reserve ratio is 5 percent and the bank has $1,000 in deposits. Its reserves amount to
$5.
$50.
$95.
$950.
A bank’s reserve ratio is 6.5 percent and the bank has $1,950 in reserve. Its deposits amount to
$62.25.
$126.75.
$22,500.00
$30,000.00.
On a bank's T-account, which are part of the banks assets?
Both deposit made by its customers and reserve
deposits made by its customers but not reserves
reserves but not deposits made by its customers
neither deposits made by its customers nor reserves
A bank’s assets equal its liabilities under
both 100-percent-reserve banking and fractional-reserve banking.
100-percent-reserve banking but not under fractional-reserve banking.
fractional-reserve banking but not under 100-percent-reserve banking.
neither 100-percent-reserve banking nor fractional-reserve banking.
A bank has a 10 percent reserve requirement, $4,000 in deposits, and has loaned out all it can given the reserve requirement.
It has $40 in reserves and $3,960 in loans
It has $400 in reserves and $3,600 in loans.
It has $444 in reserves and $3,556 in loans.
None of the above is correct.
If a bank desires to hold no excess reserves, the reserve requirement is 5 percent, and it receives a new deposit of $1,000
its required reserves increase by $50.
its total reserves initially increase by $1,000.
it will be able to make a new loan of up to $950.
All of the above are correct.
As the reserve ratio increases, the money multiplier
increases.
does not change.
decreases.
could do any of the above.
In the special case of the 100 percent-reserve banking the money multiplier is
1 and banks create money.
1 and banks do not create money.
2 and banks create money
2 and banks do not create money.
Which of the following can central bank do to change the money supply?
change reserves or change the reserve ratio
change reserves but not change the reserve ratio
change the reserve ratio but not change the reserve ratio
neither change reserves nor change the reserve ratio
When central bank conducts open-market operations to increase the money supply, it
redeems central bank notes.
buys government bonds from the public.
raises the discount rate.
decreases its lending to member banks
When central bank conducts open-market purchases,
it buys Treasury securities, which increases the money supply.
it buys Treasury securities, which decreases the money supply.
it borrows money from member banks, which increases the money supply.
it lends money to member banks, which decreases the money supply.
If central bank sells government bonds to the public, then reserves
increase and the money supply increases.
increase and the money supply decreases.
decrease and the money supply increases.
decrease and the money supply decreases
If the money multiplier is 2 and central bank wants to increase the money supply by $900,000, it could
buy $300,000 worth of bonds.
buy $450,000 worth of bonds.
sell $300,000 worth of bonds.
sell $450,000 worth of bonds.
When central bank purchases $200 worth of government bonds from the public, money supply eventually increases by
more than $200.
exactly $200.
less than $200.
None of the above are correct.
The discount rate is the interest rate that
banks charge one another for loans.
banks charge central bank for loans.
Central bank charges banks for loans.
Central bank charges firms for loans.
Central bank can increase the money supply by conducting open-market
sales or by raising the discount rate.
sales or by lowering the discount rate.
purchases or by raising the discount rate.
purchases or by lowering the discount rate.
If the money multiplier is 2 and central bank buys $50,000 worth of bonds, what happens to the money supply?
it increases by $100,000
it increases by $150,000
it decreases by $100,000
it decreases by $150,000
Central bank can decrease the money supply by conducting open-market
sales or by raising the discount rate.
sales or by lowering the discount rate.
purchases or by raising the discount rate.
purchases or by lowering the discount rate.
Which of the following can banks use to borrow from central bank?
the discount window or the term auction facility
the discount window but not the term auction facility
the term auction facility but not the discount window
Banks can not borrow from the Federal Reserve, only the government can.
Reserves increase if central bank
raises the discount rate or auctions more credit.
raises the discount rate but not if it auctions more credit.
lowers the discount rate or auctions more credit
lowers the discount rate but not if it auctions more credit.
Reserves decrease if central bank
raises the discount rate or auctions more credit.
raises the discount rate but not if it auctions more credit.
lowers the discount rate or auctions more credit.
lowers the discount rate but not if it auctions more credit.
Which of the following both increase the money supply?
an increase in the discount rate and an increase in the interest rate on reserves
an increase in the discount rate and a decrease in the interest rate on reserves
a decrease in the discount rate and an increase in the interest rate on reserves
a decrease in the discount rate and a decrease in the interest rate on reserves
Reserve requirements are regulations concerning
the amount banks are allowed to borrow from central bank.
the amount of reserves banks must hold against deposits.
reserves banks must hold based on the number and type of loans they make.
the interest rate at which banks can borrow from central bank.
In a fractional-reserve banking system, an increase in reserve requirements
increases both the money multiplier and the money supply.
decreases both the money multiplier and the money supply.
increases the money multiplier, but decreases the money supply.
decreases the money multiplier, but increases the money supply.
In a fractional-reserve banking system, a decrease in reserve requirements
increases both the money multiplier and the money supply.
decreases both the money multiplier and the money supply.
increases the money multiplier, but decreases the money supply.
decreases the money multiplier, but increases the money supply.
Other things the same, if reserve requirements are increased, the reserve ratio
increases, the money multiplier increases, and the money supply increases.
increases, the money multiplier decreases, and the money supply decreases.
decreases, the money multiplier increases, and the money supply increases.
decreases, the money multiplier decreases, and the money supply increases.
Other things the same if reserve requirements are decreased, the reserve ratio
decreases, the money multiplier increases, and the money supply decreases.
increases, the money multiplier increases, and the money supply increases.
decreases, the money multiplier increases, and the money supply increases.
increases, the money multiplier increases, and the money supply decreases.
If the Fed increases the reserve ratio from 4 percent to 10 percent, then the money multiplier
decreases from 25 to 10.
decreases from 20 to 10.
increases from 10 to 25.
increases from 10 to 20.
If the money multiplier decreased from 20 to 12.5, then
the Fed increased the reserve ratio from 5 percent to 8 percent.
the Fed increased the fed funds rate from 5 percent to 8 percent..
the Fed decreased the reserve ratio from 8 percent to 5 percent.
the Fed decreased the fed funds rate from 8 percent to 5 percent.
The Fed increases the reserve requirement, but it wants to offset the effects on the money supply. Which of the following should it do?
sell bonds to increase reserves
sell bonds to decrease reserves
buy bonds to increase reserves
buy bonds to decrease reserves
If the public decides to hold less currency and more deposits in banks, bank reserves
decrease and the money supply eventually decreases.
decrease but the money supply does not change.
increase and the money supply eventually increases.
increase but the money supply does not change.
If the public decides to hold more currency and fewer deposits in banks, bank reserves
decrease and the money supply eventually decreases.
decrease but the money supply does not change.
increase and the money supply eventually increases.
increase but the money supply does not change.
During wars the public tends to hold relatively more currency and relatively fewer deposits. This decision makes reserves
and the money supply increase.
and the money supply decrease.
increase, but leaves the money supply unchanged.
increase, but leaves the money supply unchanged.
During recessions, banks typically choose to hold more excess reserves relative to their deposits. This action
increases the money multiplier and increases the money supply.
decreases the money multiplier and decreases the money supply.
does not change the money multiplier, but decreases the money supply.
does not change the money multiplier, but decreases the money supply.
Which of the following domestically produced items is not included in GDP?
A bottle of shampoo
A hair dryer
A haircut
All of the above are included in GDP
Which of the following items is counted as part of goverment purchases
The government pays the salary of a military officer
The city of Hanoi pays a private firm to repair a highway
The city of Ho Chi Minh pays a private firm to collect garbage in the city
All of the above are correct
Gross domestic product includes all
legal and illegal final goods, but it excludes all legal and illegal final services
legal and illegal final goods and all legal and illegal final services
legal fianl goods and services, but it excludes illegal final goods and services
legal and illegal final goods and legal final services, but it excludes illegal final services
An increase in the price of bread produced domestically will be reflected in
both the GDP deflator and the consumer price index.
neither the GDP deflator nor the consumer price index.
the GDP deflator but not in the consumer price index.
the consumer price index but not in the GDP deflator.
The CPI is a measure of the overall cost of
the inputs purchased by a typical producer.
the goods and services purchased by a typical consumer.
the goods and services produced in the economy.
the stocks on the New York Stock Exchange.
The consumer price index is
not very useful as a measure of the cost of living.
a perfect measure of the cost of living.
not used as a measure of the cost of living.
a useful measure, but not a perfect measure, of the cost of living
The CPI is calculated
weekly
monthly
quarterly
yearly
If the price of Italian shoes imported into Vietnam increases,then
both the GDP deflator and the consumer price index will increase
neither the GDP deflator nor the consumer price index will increase.
the GDP deflator will increase, but the consumer price index will not increase
the consumer price index will increase,but the GDP deflator will not increase.
Investment from abroad
is a way for poor countries to learn the state-of-the-art technologies developed and used in richer countries.
is viewed by economists as a way to increase growth
often requires removing restrictions that governments have imposed on foreign ownership of domestic capital.
All of the above are correct.
Who is included in the labor force by the General Statistics Office?
Bac,an unpaid homemaker not looking for other work
Trung,a full-time student not looking for work
Nam,who does not have a job, but is looking for work
None of the above is correct.
Which of the following is an explanation for the existence of frictional unemployment
Efficiency wages
Minimum-wage laws
Unions
Job search
In a system of 100-percent-reserve banking,
Banks do not make loans.
Currency is the only form of money.
Deposits are banks' only assets.
d.All of the above are correct.
You receive money as payment for babysitting your neighbors' children.This best illustrates which function of money?
Medium of exchange
Unit of account
Store of value
Liquidity
In a system of 100-percent-reserve banking,
Banks do not accept deposits.
Banks do not influence the supply of money
Loans are the only asset item for banks.
All of the above are correct
The supply of money increases when
The value of money increases
The interest rate increases
The central bank makes open-market purchases
None of the above is correct.
When conducting an open-market purchase,the central bank
buys government bonds, and in so doing increases the money supply.
buys government bonds, and in so doing decreases the money supply.
sells government bonds, and in so doing increases the money supply.
sells government bonds, and in so doing decreases the money supply.
The quantity theory of money
is a fairly recent addition to economic theory.
can explain both moderate inflation and hyperinflation.
argues that inflation is caused by too little money in the economy.
All of the above are correct.
Money demand refers to
the total quantity of financial assets that people want to hold.
how much income people want to earn per year.
how much wealth people want to hold in liquid form.
how much currency the Federal Reserve decides to print.
When inflation rises,the nominal interest rate
Rises, and people desire to hold more money.
Rises,and people desire to hold less mone
Falls, and people desire to hold more
Falls, and people desire to hold less mone
When inflation rises,people will desire to hold
less money and will go to the bank less frequently
less money and will go to the bank more frequently.
less money and will go to the bank more frequently.
more money and will go to the bank more frequently.
If R represents the reserve ratio for all banks in the economy, then the money multiplier is
1/(1-R)
1/R
1/(1+R)
(1+R)/R
