Economics of Money, Banking and Financial Markets 12th edition by Frederic Mishkin Test bank
D) involves borrowing from investors and lending to savers.
Answer: B
Ques Status: Previous Edition
AACSB: Reflective Thinking
8) Financial institutions that accept deposits and make loans are called
A) exchanges.
B) banks.
C) over-the-counter markets.
D) finance companies.
Answer: B
Ques Status: Previous Edition
AACSB: Application of Knowledge
9) The financial intermediaries that the average person interacts with most frequently are
A) exchanges.
B) over-the-counter markets.
C) finance companies.
D) banks.
Answer: D
Ques Status: Previous Edition
AACSB: Application of Knowledge
10) Which of the following is NOT a financial institution?
A) a life insurance company
B) a pension fund
C) a credit union
D) a business college
Answer: D
Ques Status: Previous Edition
AACSB: Application of Knowledge
11) The delivery of financial services electronically is called
A) e-business.
B) e-commerce.
C) e-finance.
D) e-possible.
Answer: C
Ques Status: Previous Edition
AACSB: Information Technology
12) What crucial role do financial intermediaries perform in an economy?
Answer: Financial intermediaries borrow funds from people who have saved and make loans to other individuals and businesses and thus improve the efficiency of the economy.
Ques Status: Previous Edition
AACSB: Reflective Thinking
1.3 Why Study Money and Monetary Policy?
1) Money is defined as
A) bills of exchange.
B) anything that is generally accepted in payment for goods or services or in the repayment of debt.
C) a risk-free repository of spending power.
D) the unrecognized liability of governments.
Answer: B
Ques Status: Revised
AACSB: Application of Knowledge
2) The upward and downward movement of aggregate output produced in the economy is referred to as the
A) roller coaster.
B) see saw.
C) business cycle.
D) shock wave.
Answer: C
Ques Status: Previous Edition
AACSB: Application of Knowledge
3) Sustained downward movements in the business cycle are referred to as
A) inflation.
B) recessions.
C) economic recoveries.
D) expansions.
Answer: B
Ques Status: Previous Edition
AACSB: Application of Knowledge
4) During a recession, output declines result in
A) lower unemployment in the economy.
B) higher unemployment in the economy.
C) no impact on the unemployment in the economy.
D) higher wages for the workers.
Answer: B
Ques Status: Previous Edition
AACSB: Analytical Thinking
5) Prior to almost all recessions since 1950, there has been a drop in
A) inflation.
B) the money stock.
C) the growth rate of the money stock.
D) interest rates.
Answer: C
Ques Status: Previous Edition
AACSB: Application of Knowledge