ECO 201 - Chapter 29 Test Questions with Correct Answers Graded A+
what is currency - Answers dollar notes and coins
name term:
bank deposits that allow account owners to write checks to third parties; atm or debit cards can also
access these deposits and transmit them electronically - Answers checkable deposits
name term:
measures of the economy's money supply - Answers money aggregates
name term:
narrow measure of the money supply, consisting of currency and coins held by nonbanking public,
checkable deposits, and traveler's checks - Answers M1
is currency in bank vaults counted as part of the money supply - Answers no
what are liabilities of issuing banks, which stand ready to convert into cash - Answers checkable deposits
are checks legal tender - Answers no
what is currency circulating U.S - Answers mostly federal reserve notes produced by u.s bureau of
engraving and printing and issued as liabilities of 12 federal reserve banks
what are federal reserve notes reedmable for - Answers nothing other than more federal reserve notes
or fiat money (u.s currency)
how much of federal reserve notes circulate abroad - Answers 2/3
what is supernote - Answers counterfeit $100 note of extremely high quality that began circulating in
1990
what does foreign counterfeiting pose problem for - Answers u.s secret service; most money seized in
u.s is printed abroad
what note is most popular among domestic counterfeiters - Answers $20
what note is most popular among foreign counterfeiters - Answers $100
name term:
deposits that earn interest but have no specific maturity date - Answers savings deposits
name term:
, deposits that earn a fixed interest rate if held for the specified period, which can range from several
months to several years; also called certificates of deposits - Answers time deposits
name term:
money aggregate consisting of M1 plus savings deposits, small-denomination time deposits, money
market mutual funds, and other miscellaneous near-monies - Answers M2
do saving deposits and time deposits serve directly as media of exchange - Answers no
money market mutual fund accounts are what - Answers another component of money defined more
broad
-restrictions on minimum balance, number of checks that can be written per month, minimum amount
of each check
m2 is how many times larger - Answers 5
what percent of all consumer purchases do cred cards finance - Answers 20%
transactions using ___ and other electornic transfers now exceed payments by check - Answers debit
cards
the following are what:
-draws down checking account immediate opposed to a grace period provided by credit cards
-can't dispute bill or withhold payment as you can after writing credit card
-cant stop payment as you can after writing check - Answers disadvantages of debit cards
name term:
financial intermediaries that do not get their funds from depositors, so they choose names aimed more
at borrowers - Answers finance companies
name following:
bring together both sides of the money market
-serve as financial intermediaries
-reduce transaction costs of channeling savings to creditworthy borrowers - Answers banks
name term:
situation in which one side of market has more reliable information than the other side - Answers
asymmetic information
what is currency - Answers dollar notes and coins
name term:
bank deposits that allow account owners to write checks to third parties; atm or debit cards can also
access these deposits and transmit them electronically - Answers checkable deposits
name term:
measures of the economy's money supply - Answers money aggregates
name term:
narrow measure of the money supply, consisting of currency and coins held by nonbanking public,
checkable deposits, and traveler's checks - Answers M1
is currency in bank vaults counted as part of the money supply - Answers no
what are liabilities of issuing banks, which stand ready to convert into cash - Answers checkable deposits
are checks legal tender - Answers no
what is currency circulating U.S - Answers mostly federal reserve notes produced by u.s bureau of
engraving and printing and issued as liabilities of 12 federal reserve banks
what are federal reserve notes reedmable for - Answers nothing other than more federal reserve notes
or fiat money (u.s currency)
how much of federal reserve notes circulate abroad - Answers 2/3
what is supernote - Answers counterfeit $100 note of extremely high quality that began circulating in
1990
what does foreign counterfeiting pose problem for - Answers u.s secret service; most money seized in
u.s is printed abroad
what note is most popular among domestic counterfeiters - Answers $20
what note is most popular among foreign counterfeiters - Answers $100
name term:
deposits that earn interest but have no specific maturity date - Answers savings deposits
name term:
, deposits that earn a fixed interest rate if held for the specified period, which can range from several
months to several years; also called certificates of deposits - Answers time deposits
name term:
money aggregate consisting of M1 plus savings deposits, small-denomination time deposits, money
market mutual funds, and other miscellaneous near-monies - Answers M2
do saving deposits and time deposits serve directly as media of exchange - Answers no
money market mutual fund accounts are what - Answers another component of money defined more
broad
-restrictions on minimum balance, number of checks that can be written per month, minimum amount
of each check
m2 is how many times larger - Answers 5
what percent of all consumer purchases do cred cards finance - Answers 20%
transactions using ___ and other electornic transfers now exceed payments by check - Answers debit
cards
the following are what:
-draws down checking account immediate opposed to a grace period provided by credit cards
-can't dispute bill or withhold payment as you can after writing credit card
-cant stop payment as you can after writing check - Answers disadvantages of debit cards
name term:
financial intermediaries that do not get their funds from depositors, so they choose names aimed more
at borrowers - Answers finance companies
name following:
bring together both sides of the money market
-serve as financial intermediaries
-reduce transaction costs of channeling savings to creditworthy borrowers - Answers banks
name term:
situation in which one side of market has more reliable information than the other side - Answers
asymmetic information
