ECON 312 Week 6 Quiz

Topics: Money supply, Money, Monetary policy Pages: 2 (332 words) Published: March 5, 2015
 ECON 312
ECON 312 Week 6 Quiz
100% Correct Answers

(TCO 7) If you write a check on a bank to purchase a used Honda Civic, you are using money primarily as (TCO 7) In the United States, the money supply (M1) is comprised of (TCO 7) Answer the question on the basis of the following list of assets: 1. Large-denominated ($100,000 and more) time deposits

2. Noncheckable savings deposits
3. Currency (coins and paper money) in circulation
4. Small-denominated (less than $100,000) time deposits
5. Stock certificates
6. Checkable deposits
7. Money market deposit accounts
8. Money market mutual fund balances held by individuals
9. Money market mutual fund balances held by businesses
10. Currency held in bank vaults
Refer to the above list. The assets that are not included in either M1 or M2 are (TCO 7) Assume that Smith deposits $600 in currency into her checking account in the XYZ Bank. Later that same day, Jones negotiates a loan for $1,200 at the same bank. In what direction and by what amount has the supply of money changed (TCO 7) Overnight loans from one bank to another for reserve purposes entail an interest rate called the (TCO 7) When a bank loan is repaid, the supply of money

(TCO 7) The transactions demand for money is most closely related to money functioning as a (TCO 7) The equilibrium rate of interest in the market for money is determined by the intersection of the (TCO 7) Which of the following is not a tool of monetary policy? (TCO 7) In the latter end of 2001 the Fed cut the federal funds rate several times. The Fed’s purpose was to (TCO 7) What are the two significant characteristics of the fractional reserve banking system (TCO 7) Describe what changes in the Fed’s major policy tools lead to [a] expansionary and [b] restrictive or contractionary monetary policies
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