Question 1

What are the different types of checking accounts outlined in your text?

Accepted Answer

There are several types of checking acco...

Question 2

Which of the following is not a tool used by the Fed to implement its monetary policy?

Accepted Answer

A)   Open market operations
B)   Reserve requirements
C)   Credit controls
D)   Discount rate
E)   Individual savings accountsF) C) and D)
G) A) and E)

Question 3

The oldest and largest of all financial institutions are

Accepted Answer

A)   commercial banks.
B)   credit unions.
C)   savings & loans.
D)   insurance companies.
E)   thrift institutions.F) A) and D)
G) B) and E) A

Question 4

Money market funds are a form of mutual fund that

Accepted Answer

A)   invests in short-term debt securities issued by governments and corporations.
B)   dispenses cash and allows balance inquiries.
C)   buy and sell stocks,bonds,and other securities and provide other services.
D)   is set aside by corporations to provide retirement income.
E)   protects clients against financial losses from certain specified risks.F) A) and B)
G) All of the above

Question 5

Fiat money is backed by gold.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following unprecedented actions did the Federal Reserve take during the most recent financial crisis?

Accepted Answer

A)   Firing all CEOS of bailed-out banks
B)   Compensating all investors who lost money in the crisis
C)   Further reducing regulation of the financial industry
D)   Lending money at the discount window to nonbanking institutions like brokerage firms
E)   Keeping interest rates high to help improve bank healthF) C) and D)
G) A) and E)

Question 7

Which was not a problem during the most recent financial crisis?

Accepted Answer

A)   Dramatic declines in bank assets
B)   Collapse of the subprime mortgage market
C)   Declining home values and foreclosures
D)   Escalating home values
E)   Excessively risky securitiesF) C) and D)
G) B) and C)

Question 8

An example of electronic funds transfers (EFT)is using an automated teller machine to withdraw cash.

Accepted Answer

A) True 
 B)False

Question 9

When a dollar bill is handled hundreds of times and is still being used,it has which of the following characteristics?

Accepted Answer

A)   Portability
B)   Divisibility
C)   Durability
D)   Stability
E)   Difficult to counterfeitF) None of the above
G) A) and E)

Question 10

As a medium of exchange,money

Accepted Answer

A)   eliminates the cumbersome barter system.
B)   creates a complicated service structure.
C)   makes it harder to trade.
D)   is hard to divide.
E)   is backed by gold.F) A) and B)
G) B) and C)

Question 11

List the various types of U.S.financial institutions Dr.Hill might engage and describe the primary function of each.

Accepted Answer

The various types of U.S.financial insti...

Question 12

What services of each financial institution is Hill's new company likely to need?

Accepted Answer

From commercial banks,Hill would need sh...

Question 13

A nonbanking institution that buys and sells stocks and other securities for customers is a(n)

Accepted Answer

A)   money market fund.
B)   pension fund.
C)   insurance company.
D)   brokerage firm.
E)   automated clearinghouse.F) C) and E)
G) A) and D)

Question 14

If employees of a local school district conduct their financial business through the same financial institution that they own and only they are allowed to join,the institution is probably a(n)

Accepted Answer

A)   commercial bank.
B)   credit union.
C)   savings and loan association.
D)   insurance company.
E)   federal bank.F) C) and D)
G) A) and E)

Question 15

The major difference between banks and credit unions is that

Accepted Answer

A)   credit unions are owned and controlled by depositors.
B)   banks distribute their profits to depositors.
C)   credit unions make large loans to corporations.
D)   bank depositors vote for the bank officers.
E)   credit unions have higher default rates than banks.F) All of the above
G) None of the above A

Question 16

Which of the following limited commercial banks from engaging in certain high-risk trading activities and raised the required capital they must hold on their balance sheets?

Accepted Answer

A)   Federal Deposit Insurance Act
B)   Financial Services Modernization Act
C)   Gramm-Leach-Bliley Act
D)   Glass-Stegal Act
E)   Dodd-Frank ActF) B) and D)
G) A) and B)

Question 17

Finance companies

Accepted Answer

A)   typically function as the lender of last resort for individuals and businesses with poor credit ratings or whose other lines of credit have been exhausted.
B)   offer lower interest rates than a bank and a lower rate of risk.
C)   usually do not require collateral.
D)   do not make loans to individuals.
E)   are insured by the FDIC but at a lower rate than regular banks.F) A) and E)
G) None of the above

Question 18

What is a mutual fund?

Accepted Answer

A mutual fund is an investment vehicle t...

Question 19

Commercial banks offer a variety of services,particularly commercial loans and checking accounts.

Accepted Answer

A) True 
 B)False

Question 20

How is technology making the banking industry change?

Accepted Answer

Rapid advances and innovations in technology are challenging the banking industry and causing it to adapt.Even smaller bank are now offering electronic access (home,smartphone banking).Online financial services,ATM technology,and bill presentation are just a few of the areas where rapidly changing technology is causing the banking industry to change.Students may offer further examples based on their own experiences with the financial system.

Exam 15: Money and the Financial System

What are the different types of checking accounts outlined in your text?

Correct Answer
verified
There are several types of checking acco...
View Answer

Which of the following is not a tool used by the Fed to implement its monetary policy?

Correct Answer
verified

The oldest and largest of all financial institutions are

Correct Answer
verified
A

Money market funds are a form of mutual fund that

Correct Answer
verified

Fiat money is backed by gold.

Correct Answer
verified

Which of the following unprecedented actions did the Federal Reserve take during the most recent financial crisis?

Correct Answer
verified

Which was not a problem during the most recent financial crisis?

Correct Answer
verified

An example of electronic funds transfers (EFT)is using an automated teller machine to withdraw cash.

Correct Answer
verified

When a dollar bill is handled hundreds of times and is still being used,it has which of the following characteristics?

Correct Answer
verified

As a medium of exchange,money

Correct Answer
verified

List the various types of U.S.financial institutions Dr.Hill might engage and describe the primary function of each.

Correct Answer
verified
The various types of U.S.financial insti...
View Answer

What services of each financial institution is Hill's new company likely to need?

Correct Answer
verified
From commercial banks,Hill would need sh...
View Answer

A nonbanking institution that buys and sells stocks and other securities for customers is a(n)

Correct Answer
verified

If employees of a local school district conduct their financial business through the same financial institution that they own and only they are allowed to join,the institution is probably a(n)

Correct Answer
verified

The major difference between banks and credit unions is that

Correct Answer
verified
A

Which of the following limited commercial banks from engaging in certain high-risk trading activities and raised the required capital they must hold on their balance sheets?

Correct Answer
verified

Finance companies

Correct Answer
verified

What is a mutual fund?

Correct Answer
verified
A mutual fund is an investment vehicle t...
View Answer

Commercial banks offer a variety of services,particularly commercial loans and checking accounts.

Correct Answer
verified

How is technology making the banking industry change?

Exam 15: Money and the Financial System

What are the different types of checking accounts outlined in your text?

Correct AnswerverifiedThere are several types of checking acco...View AnswerShow Answer

Which of the following is not a tool used by the Fed to implement its monetary policy?

Correct AnswerverifiedShow Answer

The oldest and largest of all financial institutions are

Correct AnswerverifiedA

Money market funds are a form of mutual fund that

Correct AnswerverifiedShow Answer

Fiat money is backed by gold.

Correct AnswerverifiedShow Answer

Which of the following unprecedented actions did the Federal Reserve take during the most recent financial crisis?

Correct AnswerverifiedShow Answer

Which was not a problem during the most recent financial crisis?

Correct AnswerverifiedShow Answer

An example of electronic funds transfers (EFT)is using an automated teller machine to withdraw cash.

Correct AnswerverifiedShow Answer

When a dollar bill is handled hundreds of times and is still being used,it has which of the following characteristics?

Correct AnswerverifiedShow Answer

As a medium of exchange,money

Correct AnswerverifiedShow Answer

List the various types of U.S.financial institutions Dr.Hill might engage and describe the primary function of each.

Correct AnswerverifiedThe various types of U.S.financial insti...View AnswerShow Answer

What services of each financial institution is Hill's new company likely to need?

Correct AnswerverifiedFrom commercial banks,Hill would need sh...View AnswerShow Answer

A nonbanking institution that buys and sells stocks and other securities for customers is a(n)

Correct AnswerverifiedShow Answer

If employees of a local school district conduct their financial business through the same financial institution that they own and only they are allowed to join,the institution is probably a(n)

Correct AnswerverifiedShow Answer

The major difference between banks and credit unions is that

Correct AnswerverifiedA

Which of the following limited commercial banks from engaging in certain high-risk trading activities and raised the required capital they must hold on their balance sheets?

Correct AnswerverifiedShow Answer

Finance companies

Correct AnswerverifiedShow Answer

What is a mutual fund?

Correct AnswerverifiedA mutual fund is an investment vehicle t...View AnswerShow Answer

Commercial banks offer a variety of services,particularly commercial loans and checking accounts.

Correct AnswerverifiedShow Answer

How is technology making the banking industry change?

Correct Answer
verified
There are several types of checking acco...
View Answer

Correct Answer
verified

Correct Answer
verified
A

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The various types of U.S.financial insti...
View Answer

Correct Answer
verified
From commercial banks,Hill would need sh...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
A

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
A mutual fund is an investment vehicle t...
View Answer

Correct Answer
verified