QUIZ
Unit 4.17 Assessment Review
2 years ago by
22 questions
Q.

Which describes the type of exchange that does not use money?

answer choices

financing

borrowing

bartering

purchasing

Q.

Which most accurately explains why fiat money differs from commodity money?

answer choices

Fiat money an also be used as a productive input.

Fiat money only has value as a medium of exchange.

Fiat money has value because it is a precious metal such as gold.

Fiat money has value because it enables the barter system to work.

Q.

Which accurately describes the requirements banks must meet under a fractional reserve banking system?

answer choices

Banks must get government approval for all loans

Banks must keep a specific percentage of deposits on hand.

Banks must pay a specific fraction of their assets in taxes.

Banks reserve the right to raise interest rates at any time.

Q.

Which is the purpose of requiring banks to keep a specific percentage of their deposits on hand in the vault?

answer choices

To prevent growth of the money supply from stagnating

To ensure that banks have enough money to loan to potential customers

To make sure customers' demand for withdrawals can be met instantly

to enable the government to calculate the bank's tax burden more easily

Q.

Which is the purpose of the Federal Reserve Bank?

answer choices

protect bank depositors against losing their money

manage the growth of the U.S. economy

prevent stock market fraud

issue government bonds

Q.

Which is the purpose of the Securities and Exchange Commission (SEC)?

answer choices

issues government bonds

manage the growth of the U.S. economy

protect bank depositors against losing their money

prevent stock market fraud

Q.

Which is the purpose of the U.S. Treasury department?

answer choices

issue government bonds

manage the growth of the U. S. economy

prevent stock market fraud

protect bank depositors against losing their money

Q.

Which can the Federal Reserve Bank (FED) accomplish by raising or lowering the required reserve ratio?

answer choices

prevent a budget deficit

increase or decrease the money supply

reduce housing prices

ensure an equitable distribution of wealth

Q.

Which can the Fed accomplish by raising or lowering the required reserve ratio?

answer choices

When the required reserve ratio is raised, banks must raise interest rates so that fewer people can afford to take loans.

When the required reserve ratio is raised, banks must loan out a smaller portion of their reserves, resulting in fewer loans.

When the required reserve ration is raised, banks must loan out a larger portion of their reserves, leaving less of a supply on hand.

Q.

How can a government best redistribute wealth?

answer choices

by enacting a progressive tax system

through the use of tariffs and duties

Q.

Which describes the most likely effect of the sale of a new batch of Treasury bonds?

answer choices

An increase in the money supply

A decrease in the money supply

Q.

Which describes the most likely effect of the sale of new batch of Treasury bonds?

answer choices

an increase in unemployment

a decrease in the money supply

Q.

Which describes the most likely effect of the Fed lowering the discount rate on overnight loans?

answer choices

a reduction in the inflation rate

an increase in the money supply

Q.

What purpose do price ceilings serve?

answer choices

they protect the poor

increase production

Create a surplus of goods

they enable rationing

Q.

Price ceiling is the maximum price the government allows seller to charge.

answer choices

True

False

Q.

The Supreme law that governs the United States is

answer choices

the Constitution

House of Representatives

Senate

Q.

Counterfeiting is legal. (True or False)

answer choices

True

False

Q.

Domestic Commerce

answer choices

is foreign commerce

is international commerce

is within the same country

Q.

Tariffs are taxes on producers and consumers from outside the United States.

answer choices

True

False

Q.

Taxes are collected at which level:

answer choices

State

Federal

local

All of the above

Q.

In the United States, who first proposes the federal budget?

answer choices

citizens

Congress

state governors

the president

Q.

Which agency would be most likely to make sure a new baby stroller has acceptable safety features?

answer choices

The FTC

The FDA

The CPSC

The EPA

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