ECON 3200 Final exam with answers |\ |\ |\ |\ |\
Test 1 |\ |\
A .......... is an example of a security, which is a claim on
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future income or .......... - CORRECT ANSWERS ✔✔bond;
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debt
Which of the following provides financial intermediation? -
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CORRECT ANSWERS ✔✔A bank
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Monetary policy, is usually conducted by a - CORRECT
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ANSWERS ✔✔Commercial banks |\ |\
Indirect finance is .... - CORRECT ANSWERS ✔✔Indirect
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finance is the act of borrowing from a third party lender.
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This allows lower transaction costs, and less risk to the
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investor.
What are the three functions of money? (just name them)
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- CORRECT ANSWERS ✔✔store of value, unit of account,
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and medium of exchange
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, Explain why the money economy is superior to the barter
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economy? - CORRECT ANSWERS ✔✔The money economy |\ |\ |\ |\ |\ |\ |\
is superior to the barter economy because instead of
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trying to place a certain value to each item in order to
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
trade in a barter economy, the money economy allows
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everyone to have a singular unit in order to purchase |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
items
How would you compare M1 and M2 ? (use definition) -
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CORRECT ANSWERS ✔✔- In M1 you combine items such |\ |\ |\ |\ |\ |\ |\ |\ |\
as currency, travelers checks, demand deposit, and other
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checkable deposits. |\
- M2 is M1 added to small domination time deposits,
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savings deposits and money market deposits, and money
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market mutual funds. |\ |\
- The use the Growth rate formula to compare how they
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have changes over time
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What does "present value" mean? you could use a simple
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example. - CORRECT ANSWERS ✔✔the value in the |\ |\ |\ |\ |\ |\ |\ |\
present of a sum of money |\ |\ |\ |\ |\
How much is the current yield on a $6000, 10% coupon
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bond selling for $4000? - CORRECT ANSWERS ✔✔15%
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Test 1 |\ |\
A .......... is an example of a security, which is a claim on
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
future income or .......... - CORRECT ANSWERS ✔✔bond;
|\ |\ |\ |\ |\ |\ |\ |\
debt
Which of the following provides financial intermediation? -
|\ |\ |\ |\ |\ |\ |\
CORRECT ANSWERS ✔✔A bank
|\ |\ |\ |\
Monetary policy, is usually conducted by a - CORRECT
|\ |\ |\ |\ |\ |\ |\ |\ |\
ANSWERS ✔✔Commercial banks |\ |\
Indirect finance is .... - CORRECT ANSWERS ✔✔Indirect
|\ |\ |\ |\ |\ |\ |\ |\
finance is the act of borrowing from a third party lender.
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
This allows lower transaction costs, and less risk to the
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
investor.
What are the three functions of money? (just name them)
|\ |\ |\ |\ |\ |\ |\ |\ |\
- CORRECT ANSWERS ✔✔store of value, unit of account,
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
and medium of exchange
|\ |\ |\
, Explain why the money economy is superior to the barter
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
economy? - CORRECT ANSWERS ✔✔The money economy |\ |\ |\ |\ |\ |\ |\
is superior to the barter economy because instead of
|\ |\ |\ |\ |\ |\ |\ |\ |\
trying to place a certain value to each item in order to
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
trade in a barter economy, the money economy allows
|\ |\ |\ |\ |\ |\ |\ |\ |\
everyone to have a singular unit in order to purchase |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
items
How would you compare M1 and M2 ? (use definition) -
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
CORRECT ANSWERS ✔✔- In M1 you combine items such |\ |\ |\ |\ |\ |\ |\ |\ |\
as currency, travelers checks, demand deposit, and other
|\ |\ |\ |\ |\ |\ |\ |\
checkable deposits. |\
- M2 is M1 added to small domination time deposits,
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
savings deposits and money market deposits, and money
|\ |\ |\ |\ |\ |\ |\ |\
market mutual funds. |\ |\
- The use the Growth rate formula to compare how they
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
have changes over time
|\ |\ |\
What does "present value" mean? you could use a simple
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
example. - CORRECT ANSWERS ✔✔the value in the |\ |\ |\ |\ |\ |\ |\ |\
present of a sum of money |\ |\ |\ |\ |\
How much is the current yield on a $6000, 10% coupon
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
bond selling for $4000? - CORRECT ANSWERS ✔✔15%
|\ |\ |\ |\ |\ |\ |\
