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Exam 20: Money,financial Institutions,and the Federal Reserve

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Question 141

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President Dude,the leader of the island nation of Jaylo,refuses to raise taxes,but wants to expand many government services and increase the size of the Jaylo armed forces.He plans to pay for all of the desired expenditures by printing more money.If President Dude carries out his plan by rapidly increasing the supply of money,Jaylo will likely experience:

A) a severe recession.
B) reduced private sector spending.
C) widespread surpluses of goods and services.
D) an increase in the rate of inflation.

E) All of the above
F) B) and D)

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Question 142

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When the value of the dollar falls,foreign goods become less expensive for American consumers.

A) True
B) False

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Question 143

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First Data Corporation has developed the GO-Tag,where:

When the Federal Reserve pursues policies that increase interest rates,the amount of foreign funds flowing into the United States also increases.

Which of the following can include an embedded radio-frequency antenna that allows the holder to access secure areas in buildings or buy gas with the swipe of a card?

Which of the following represents one way the Fed increases the amount of money in circulation?

Recently,the Fed announced a reduction in the discount rate and the reserve requirement.These actions clearly suggest that the Fed intends to decrease the money supply.

When Mrs.Sweet exchanges her famous chocolate chip cookies for the lawn care services of her neighbor,she engages in a barter transaction.

Fortunately,the Troubled Assets Relief Program TARP)took care of the looming bankruptcy problems of major financial services institutions,and taxpayers were not hit with additional bailouts.

Theoretically,with the proper monetary policy,the U.S.economy can continue to grow without causing inflation.

The global money markets trade about $4 trillion every day.

A __________ represents an agreement by a bank to pay a foreign company a given amount if certain conditions are met.

During Red's time as head of the Bank of Bramblewood,the bank offered three services: time deposits,demand deposits,and home and business loans.Under Patty's leadership,the bank offers those services,a variety of investment opportunities such as mutual funds and bonds,and they are set-up to provide ___________ through the Internet which may involve a number of services such as paying bills directly from one's account,or transferring money from one account to another.

Thomas Jefferson proposed the establishment of the first central bank in the United States.

One thing is for certain,the average borrower's risk-averse behavior did not contribute to the problems that spiraled out of control and caused the recent banking crisis.

Electronic fund transfer EFT)tools include debit cards,smart cards,direct deposit,direct payments,and electronic check conversion.

In the early 1800s,the United States allowed banks to issue different kinds of currencies.

Prior to the Civil War,the United States had two unsuccessful attempts at a central bank.

Which of the following statements most accurately represents the history of U.S.banking?

Early in our nation's history,people generally accepted the importance of a central bank authority.