Macroeconomics Questions
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14-14 which of the following is not part of M1?A) checking accountsB) coinsC) credit cardsD) paper currency
16-8 The V in the equation represents the A) variation in GDPB) variation in cpiC) variation in real gdpD) ave. number of times per year a dollar is spent on final goods and services
15-2 If total deposits at last bank and trust are $100 million, total loans are $70 and excess reserves are $20 million, then which of the following is required reserve ratio?A) 70%B) 30%C) 20%D) 10%
16-2 A decrease in the interest rate, other things being equal causes a(n) A) upward movement along the demand curve for moneyB) downward movement along the demand curve for moneyC) rightward shift of the demand curve for moneyD) leftward shift of the demand curve for money
16-10 Keynesians reject the influence of monetary policy on the economy. One argument supporting this Keynesian view is that theA) money demand curve is horizontal at any interest rateB) aggregate demand curve is nearly flatC) investment demand curve is nearly vertical. D) money demand curve is vertical
16-5 assume the demand for money curve is fixed and the fed increases the money supply. the result is that the price of bondsA) risesB) remains unchangedC) fallsD) none
16-4 assume the demand for money curve is fixed and the fed decreases the money supply. the result is a temporaryA) excess quantity of money demandedB) excess quantity of money suppliedC) increase in the price of bondsD) increase in the demand for bonds
14-13 Which of the following is part of the M2 definition of the money supply, but not part of M1?A) checkable depositsB) currency held in banksC) currency in circulationD) money market mutual fund shares
16-7 based on the equation of exchange, the money supply in the economy is calculated asA) M=V/PQB) M=V(PQ)C) MV=PQD) M= PQ - V
14-20 Which of the following is not part of the fed. reserve system?A) council of economic advisorsB) board of governersC) federal open market committeeD) 12 federal reserve district banksE) federal advisory council
14-18 Which of the following is in charge of the buying and selling of gov. securities by the fed?A) presidentB) federal open market committeeC) congressD) none
14-17 Which of the following is not one of the functions of the federal reserve?A) clearing checksB) printing currencyC) supervising and regulating banksD) controlling the money supply
15-3 Which of the following is correctly the money multiplier?A) the required reserve ratioB) 1/(1-the required reserve ratio)C) 1/(required reserve ratio)D) 1/(1-MPC)
16-15 the monetarist transmission mechanism through which monetary policy affects the price level, real gdp, and employment depends on theA) indirect impact of changes on the interest rateB) indirect impact of changes on profit expectationsC) indirect impact of changes in fiscal policy on aggregate demandD) indirect impact of changes in the monetary supply on aggregate demand
14-15 Which definition of the money supply includes credit cards, or plastic money?A) M1B) M2C) both a and bD) neither a nor b
15-4 If the fed decides to engage in an open market operation to increase the money supply, what will it do?A) sell treasury bonds, bills or notes on the bond marketB) buy treasury bonds, bills or notes on the bond marketC) increase the required reserve ratioD) increase the fed funds rate
14-7 Which of the following is not a characteristic of money?A) it provides a way to measure the relative value of goods and servicesB) it is always backed by something of high intrisstic value such as gold or silverC) it is generally acceptable as a medium of exchange D) it allows for saving and borrowing
14-2 Which of the following defines the "unit fo account" function of money?A) a common measurement of the relative value of different goods and servicesB) the ability of money to hold value over timeC) the materials used to to manufacture money are of medium grade or quality so that people will not hoaard money for its commodity valueD) money is widely accepted in exchange for goods and services
14-5 If a society were to use a widely accepted, easily measurable, but highly perishable food product as its money, which of the following functions of money would me most impaired?A) medium of exchangeB) unit of accountC) store of valueD) none
14-10 M1 refers toA) the most narrowly defined money supplyB) currency held by the public plus checking acct. balancesC) the smallest $ amount of money supply definitionsD) all