Money and banking quiz

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Question 1 (1 point)

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An increase in which of the following factors (from the perspective of the domestic country) would cause an appreciation of the domestic currency in the long run?

 
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Question 2 (1 point)

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An increase in a country’s trade barriers will cause the _____ for its currency to shift to the

 
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Question 3 (1 point)

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Most currency trading takes place

 
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Question 4 (1 point)

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A rise in the real interest rate in a country causes its currency to

 
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Question 5 (1 point)

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In practice, the primary tool used by the Federal Reserve to control the money supply is

 
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Question 6 (1 point)

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A change in which of the following tools shifts the demand for reserves?

 
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Question 7 (1 point)

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The goal of quantitative easing is to _____.

 
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Question 8 (1 point)

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In practice, discount lending is used

 
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Question 9 (1 point)

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Central banks make money from interest on

 
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Question 10 (1 point)

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Which of the following is a liability of the Fed?

 
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Question 11 (1 point)

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If the Fed sells $50 in securities and the reserve requirement is 25%, according to the simple formula for the money multiplier, the money supply

 
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Question 12 (1 point)

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If the Fed buys $100 in securities and the reserve requirement is 10%, according to the simple formula for the money multiplier, the money supply

 
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Question 13 (1 point)

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Which of the following is a difference between Keynes liquidity preference theory and the modern quantity theory of money?

 
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Question 14 (1 point)

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A liquidity trap occurs when

 
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Question 15 (1 point)

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Which of the following is equivalent to velocity?

 
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Question 16 (1 point)

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People holding money in anticipation that bond yields will rise is an example of

 
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Question 17 (1 point)

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In Keynes’s model, a(n) _____ in interest rates can decrease the _____ demand for money.

 
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Question 18 (1 point)

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Which of the following is an asset of the Fed?

 
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Question 19 (1 point)

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Exchange rates are determined in

 
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Question 20 (1 point)

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When the Fed raises the reserve requirement, the _____ of reserves shifts

 
  
  
  
  
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