Question 1

You expect a share of EconNews.Com to sell for $65 a year from now.If you are willing to pay $62.73 for one share of the stock today,and you expect a dividend payment of $4,what rate of return do you require?

Accepted Answer

A)  3.6%
B)  6.2%
C)  6.4%
D)  10%E) A) and D)
F) B) and D)

Question 2

Credit card balances are not considered to be money primarily because they:

Accepted Answer

A)  are rarely used to make purchases.
B)  are not part of people's wealth.
C)  are an asset used in making transactions.
D)  do not represent an obligation to pay someone else.E) None of the above
F) A) and B)

Question 3

An open-market purchase of government securities by the Fed will:

Accepted Answer

A)  increase bank reserves,and the money supply will increase.
B)  decrease bank reserves,and the money supply will increase.
C)  increase bank reserves,and the money supply will decrease.
D)  decrease bank reserves,and the money supply will decrease.E) B) and C)
F) None of the above

Question 4

The direct trade of goods and services for other goods and services is called:

Accepted Answer

A)  financial intermediation.
B)  diversification.
C)  barter.
D)  using a medium of exchange.E) A) and B)
F) A) and D)

Question 5

The coupon rate on newly issued bonds is usually higher for bonds with ______ terms and ______ risk that the borrower will go bankrupt.

Accepted Answer

A)  shorter;greater
B)  shorter;smaller
C)  longer;greater
D)  longer;smallerE) B) and C)
F) B) and D)

Question 6

If the desired reserve/deposit ratio is 0.25 and the banking system receives an additional $10 million in reserves,bank deposits will increase by:

Accepted Answer

A)  $10 million.
B)  $250 million.
C)  $40 million.
D)  $4 million.E) B) and C)
F) A) and D)

Exam 20: Money, Prices, and the Financial System

If the desired reserve/deposit ratio is 0.25 and the banking system receives an additional $10 million in reserves,bank deposits will increase by:

Correct Answer
verified

Credit card balances are not considered to be money primarily because they:

Correct Answer
verified

The direct trade of goods and services for other goods and services is called:

Correct Answer
verified

You expect a share of EconNews.Com to sell for $65 a year from now.If you are willing to pay $62.73 for one share of the stock today,and you expect a dividend payment of $4,what rate of return do you require?

Correct Answer
verified

An open-market purchase of government securities by the Fed will:

Correct Answer
verified

The coupon rate on newly issued bonds is usually higher for bonds with terms and risk that the borrower will go bankrupt.

Correct Answer
verified

Exam 20: Money, Prices, and the Financial System

If the desired reserve/deposit ratio is 0.25 and the banking system receives an additional $10 million in reserves,bank deposits will increase by:

Correct AnswerverifiedShow Answer

Credit card balances are not considered to be money primarily because they:

Correct AnswerverifiedShow Answer

The direct trade of goods and services for other goods and services is called:

Correct AnswerverifiedShow Answer

You expect a share of EconNews.Com to sell for $65 a year from now.If you are willing to pay $62.73 for one share of the stock today,and you expect a dividend payment of $4,what rate of return do you require?

Correct AnswerverifiedShow Answer

An open-market purchase of government securities by the Fed will:

Correct AnswerverifiedShow Answer

The coupon rate on newly issued bonds is usually higher for bonds with ______ terms and ______ risk that the borrower will go bankrupt.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

The coupon rate on newly issued bonds is usually higher for bonds with terms and risk that the borrower will go bankrupt.

Correct Answer
verified