business chapter 15
________ charge a penalty for withdrawing money prematuraly
certificate of deposits
the life expectancy of a $20 bill is estamated 7.7 years. which of the following charteristic of money does this statement illustrated
durability
which of the following charteristics of money refers to the ability of a dollar bill
durability
an ________ underwrites new issues of secruites for corporations states and municipalities needed to raise money in the capital
investment banker
________ are similar to interest bearing checking accounts but with more restrictions
money market accounts
when the federal reserve board increases the reserve requirments the
money supply declines
a ______ is a loan made so that a business or individual can purchase real estate, typically a home
mortgage
the acronym NOW when used by financial instirtuitions, strand for ______ and is a type of interest bearing checking account
negotiable order of withdrawals
when the federal reserve board increase the reserve requiremtn the:
percentage of deposits that banks must hold in reserve decline
which of the following is peer to peer lender
prosper
a checking account at a credit union is commonly referred to as a
shared draft account
which of the following acts restricted commercial banks from engaging in certain high risk trading activities and also raised the required capital that banks must hold on their balance sheets
the dodd frank act
according to the federal reserve board what is the estimated life span of $1 notes
5.9 years
for money to serve effectively as a measure of a value all items must be valued in terms of comparable units, which of the following charateristics of money does this statement
Divisibilty
certificates of deposits are accounts with funds that usually cannot be withdrawn without advance notice and/or have limits on the number of withdrawls per period
False
the ________ prohibited commercial banks from being in the insurance and investment banking busniess
Glass- Steagall act
which of the following effects is seen on the moeny supply and the economy when the federal reserve board raises the discount rate?
interest rates increase: the money supply decrease: economic activty slows down.
which of the following is true of kickstarters
it funds creative projects in the world of art
which of the following statements is true of money
it is anything accepted in exchange for goods and services
which of the following actions did the federal reserve take during the most recent financial crisis between 2000 and 2008
it kept the interest rates low to stimulate the economy
there is an increase in economic activity when the federal reserve board
lowers the discount rate
when a person pays $23,000 to buy a car, money primarily functions as a
measure of value
a person swaps a bag of fruits for some meat. in this case money functions as a
medieum of exchage
if a person invest in a firm that pools funds from a large number of people and buys and professionally manages stock from a number of dicersified companies that person is investing in a
mutual fund
if a person invest in a firm that pools funds from a large number of people and buys and professionally manges stock from companies that person is investing in an
mutual fund
which of the following institutions is similar to a savings and loan association but is owned by depositers
mutual savings bank
the actual purcahse or sale of investment in the open market is performed by ther
new york federal reserve bank
nonbanking institution differ from banking instituions in that they
offer investment products
finance companies
offer short term loans
a money market fund differs from a bank money market account in that the former
offers slightly higher rates of interest than a bank money market
_______ allows consumers to perform an ever widening array of financial transactions from their personal or work computer
online banking services
which of the following effects is seen on the money and the economy when the federal reserve board restricts credits control?
people are discouraged from making major purchases decreasing economic activty
for many to function as a medieum of exchange it must be easily moved from one location to the next. which of the following charaters money does this statement reflects?
profitability
which of the following factors has challeneged the banking industry and forced it to undergo changes?
rapid technological innovatations
as a medium of exchange money
reduces the need for bartering
the federal reserve board was established by congress in 1913 to
regulate the banking industry
there is an increase in economic activity when the federal reserve board
relaxes credit controls
commercial banks
rely on checking and savings accounts for funds
a money market fund differs from the money market account offered by banks primarly in that the former
represents a pool of funds not a specilaized individual checking account
a money market fund is a special type of mutual fund that
represents sprecialized individual checking accounts
________ often called "thrifts" are financial institutions that primarly offer savings accounts and make long term loans for residens
savings and loan associations
a savings account at a credit union is commonly referred to as a
share account
_______ refers to companies performing banking functions of some sort that are not regulated by banking regulators
shawdow banking
which of the following is the largest pension fund
social security
in some countries with very high inflation rates, citizens tend to spend their money as fast as they recieve it in order to keep it from losing any more of its value. under these conditions money issaid to lack:
stability
stans sister tells stan that the number of toffees she could buy for a dollar when she was his age greater. stans sister is now money
stability
which of the following charteristics of money allows people to postpone purchases and save their money to do so
stability
when inflation is very high money loses its_________
stabilty
when inflation is very high, money loses its ________
stabitly
when money serves as a way to accumlate wealth money primarly functions a
store of value
why are credit cards a popular substitute for cash payments?
they are accepted by merchands around the world
the federal reserve board controls thatthe amount of money availble in the econmy
thrugh monetary policy
savings accounts are also known as
time deposits
money is a medium of exchange
true
_________ premits payment such as a deposits or withdrawls to be made to and from a bank account by magnetic computer type
automated clearing house
_______, a form of electronic banking allow financial instituions to reduce cost by facilitating paperless transactions
automated teller machines
what is an outcome of the federal reserve bank decresing the reserve requirements?
banks make more loans money supply increase economic activity increases
ryan traded his tablet PC for a cellphone. since both were of the same value there was no exchange this scenario illustrates
bartering
a nonbanking financial instrituion that buys and sells stocks bonds and other secruities for its customers is called
brokerage firm
which of the following actions is the federal reserve board most likely to take in an attempt to increase the money supply in theeconomy
buy government secrurities
open market operations refer to decision to
buy or sell US treasury bills and other investment in the open market
open market operations refer to decisisons to
buy or sell US tresury bills and other investments in the open market
a check
can be rendered worthless in case of suspected fogery
a money market sccount differs from an interest bearing checking account in that the owners
can write only a limited number of checks each month
__________ are savings accounts that guarantee a depositor a set interest rate over a specific interval of time as long as the funds are not prematurely
certificates of deposits
US money included subtle colors in addition to the tradtional green as well as enhanced secruity featuers such as a watermark security color-shifting ink. which of the following charteristics of money is being protected by there measures
inimitabilty
_______ are businesses that protect their clients against financial losses from certian specified risks in exchange for a fee called a premium
insurance companies
to be effective, money must be readily recieved for the purchase of goods and servises and for the settlement of debts. which of the following charteristics of money does this statement reflect?
acceptability
credits cards:
allow cardholders to pay pay for transactions at a later date
the federal reserve board is primarlyresponsible for
creating a stable environment for economic growth
which of the following act limited the ability of credit card issues to raised rates limited credit to young adults and gave people more time to pay bills
credid card Act
the major difference between banks and credit unions is that
credit unions are owned and controlled by their depositers
coins are used primarily to provide
divisibilty
for money to serve effectively as a measure of value. all items must be valued in terms of comparable units, which of the following charteristics of money does this statement reflect?
divisibilty
in reaction to the financial meltdown and severe recessions, congress passes the ______ to eliminate the ability of the banks to create the in the future
dodd_frank act
in reaction to the financial meltdown and severe recession, congree passed the ______ to eliminate the abilty of the banks to create the same in the future
dood_frank act
a credit union is owned and controlled by the government
false
finance companies buy and see stock and bonds to their customers
false
the _______ insures individual bank accounts
federal deposit insurance corporation
the _______ is the guardian of the american finnancial system
federal reserve board
_____ is best described as a paper money that is not readitly convertable to a precious metal such a s gold
fiat money
are businesses that offer short term loans at substanitally higher rates of interest than banks
finance companies
the ______ repealed the glass stegall act. putting US commercial banks on the same competetive footing as european banks
gramm-leach-bliley act
if consumers do not pay off their entire card balance they
have to pay interest on the unpaid amount
in general the longer the term of a certificate of depost the
higher is its interest rate