This Tutorial contains 4 Set of Week 4 Quiz (All Questions Listed Below) ECO 203 Week 4 Quiz 1 1. � Question : � The bulk of the M1 money supply is made up of 2. � Question : � Through open market operations, the Federal Reserve 3. � Question : � All but which one of the following are tools of monetary policy? 4. � Question : � Which of the following is a function performed by a modern society’s money? 5. � Question : � If the Federal Reserve creates excess bank reserves, banks are likely to 6. � Question : � The central bank and monetary authority of the United States is 7. � Question : � The M1 money supply includes 8. � Question : � The fact that money is legal tender increases its 9. � Question : � In the classical model, the money supply affects the economy 10. � Question : � The most important monetary tool of the Federal Reserve System is ECO 203 Week 4 Quiz 2 1. � Question : � In an economy with a large foreign sector, compared to one with little international economic activity, 2. � Question : � To keep the federal funds rate from rising above the target zone, the Fed must 3. � Question : � The store of wealth function of money refers to money as 4. � Question : � If the demand for money is highly sensitive to changes in the interest rate, a small decrease in the interest rate will cause 5. � Question : � When the Fed changes monetary policy in response to changing economic conditions, it is 6. � Question : � Changes in the reserve ratio, open market operations, and changes in the discount rate are all tools used by the Fed to 7. � Question : � Individuals accept dollars because 8. � Question : � The medium of exchange function of money refers to money as 9. � Question : � The lender of last resort function refers to 10. � Question : � The First National Bank of Oklahoma has checkable deposits of $10,000,000 and total reserves of $2,500,000; the reserve ratio is 15 percent. What is the most this bank can lend out? ECO 203 Week 4 Quiz 1. � Question : � M1 includes all but which one of the following? 2. � Question : � The most important monetary tool of the Federal Reserve System is 3. � Question : � If the Fed sells government bonds on the open market, which of the following is likely to occur? 4. � Question : � In the classical model, the money supply affects the economy 5. � Question : � The First National Bank of Oklahoma has checkable deposits of $ 10,000,000 and total reserves of $2,500,000; the reserve ratio is 15 percent. What is the required level of reserves for this bank? 6. � Question : � Which of the following is a function performed by a modern society’s money? 7. � Question : � If the market for money is in equilibrium, then 8. � Question : � A bank’s lending out a portion of the deposits of its customers is 9. � Question : � If the Federal Reserve creates excess bank reserves, banks are likely to 10. � Question : � Which of the following is NOT a correct statement? Week 4 Quiz Set 4 1. � Question : � M1 includes all but which one of the following? 2. � Question : � The transactions demand for money depends on 3. � Question : � Individuals accept dollars because 4. � Question : � The fact that money is legal tender increases its 5. � Question : � According to the M1 definition, the money supply consists of currency held by the public plus 6. � Question : � To keep the federal funds rate from rising above the target zone, the Fed must 7. � Question : � If the Fed sells government bonds on the open market, which of the following is likely to occur? 8. � Question : � When the Federal Open Market Committee buys a government bond from a bank, 9. � Question : � Transactions that involve the direct trade of one good for another are called 10. � Question : � � The ability of an ass
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