ECON 1100 Chapter Notes - Chapter 9: Financial Institution, Hong Kong Economic Times, Quantitative Easing

26 views2 pages

tanelephant924

7 Dec 2013

School

Department

Course

Professor

For unlimited access to Textbook Notes, a Class+ subscription is required.

Document Summary

Chapter 9: central banking, commercial banking and money. The use of money as a medium of exchange eliminates the need for barter. Money serves as a unit of account and a store value. The collapse of money supply would have recessionary consequences. The explosion of money supply would have inflationary consequences. Money: any asset that can be used as a means of payment for purchases and to settle debts. Commodity money: an asset with intrinsic value, such as a gold or silver coin, that is generally accepted as a means of payment for purchases to settle debt. Fiat money: an asset with no intrinsic value, such as paper currency, that is generally accepted as a means of payment for purchases and to settle debt. Medium of exchange: an asset used in purchasing goods/services. Barter: the direct trade of goods/services for other goods/services. Unit of account: a basic measure of economic value.

Related Questions

1. To say money is socially defined means that:

A) the money supply includes all public and private securities purchased by society.

B) whatever performs the functions of money extremely well is considered to be money.

C) society, acting through Congress, specifies what shall be included in the money supply.

D) money has been defined in a Constitutional amendment.

2. Money functions as:

A) a medium of exchange.

B) a store of value.

C) a unit of account.

D) all of these.

3. If you are estimating your total expenses for school next semester, you are using money primarily as:

A) a store of value.

B) an economic investment.

C) a unit of account.

D) a medium of exchange.

4. If you place a part of your summer earnings in a savings account, you are using money primarily as a:

A) medium of exchange.

B) store of value.

C) standard of value.

D) unit of account.

5. If you write a check on a bank to purchase a used Honda Civic, you are using money primarily as:

A) a store of value.

B) a medium of exchange.

C) a unit of account.

D) an economic investment.

6. A $70 price tag on a sweater in a department store window is an example of money functioning as a:

A) standard of deferred payments.

B) medium of exchange.

C) unit of account.

D) store of value.

7. Stock market price quotations best exemplify money serving as a:

A) index of satisfaction.

B) store of value.

C) medium of exchange.

D) unit of account.

8. Purchasing common stock by writing a check best exemplifies money serving as a:

A) medium of exchange.

B) unit of account.

C) index of satisfaction.

D) store of value.

crimsonalligator541

1. If you write a check on a bank to purchase a used Honda Civic, you are using money primarily as:

a. A medium of exchange.

b. A store of value.

c. A unit of account.

d. An economic investment.

2. To say that coins are "token money" means that:

a. Their face value is less than their intrinsic value.

b. Their face value is greater than their intrinsic value.

c. Their face value is equal to their intrinsic value.

d. They are not legal tender.

brownsea-lion330

Question 2 (3 points) If an individual bank receives $100,000 in new deposits and the required reserve ratio is 10 percent, the bank must keep the following amount of required reserves with the Fed?

$90,000.

$1,000,000. '

Zero.

$10,000.

Question 3 (3 points) Assume that the Fed purchases $10 million in bonds from a bank, the monetary base will:

Increase by $10 million.

Remain unchanged.

Decrease by $10 million.

Increase by $5 million.

Question 4 (3 points) When we say that money has a function as a medium of exchange, this implies that:

Money must be in the form of a precious metal such as gold.

Money must be set at a fixed exchange rate in international currency markets.

Money is backed by the gold standard.

Money is used to purchase goods and services rather than resorting to barter.

Question 5 (3 points) Which of the following is not considered an asset for a bank:

Customer deposits.

U.S. government treasury bills.

Corporate loans.

U.S. government-issued debt.

amberbeaver601

ECON 1100 Chapter Notes - Chapter 9: Financial Institution, Hong Kong Economic Times, Quantitative Easing

Document Summary

Get access

Related Documents

ECON 1100 Lecture Notes - Quantitative Easing, Deposit Insurance, Financial Institution

ECON 1100 Chapter Notes - Chapter 9: Openmarket, Quantitative Easing, Hong Kong Economic Times

ECON 1100 Chapter Notes - Chapter 10: Credit Union, Fractional-Reserve Banking, Mortgage Loan

Related Questions