Between 1995 and 2000 (Points : 1) the growth in size of foreign banks meant tha
ID: 1229931 • Letter: B
Question
Between 1995 and 2000 (Points : 1)the growth in size of foreign banks meant that the United States no longer had any banks among the 30 largest in the world.
mergers resulted in two U.S. banks becoming among the ten largest in the world.
mergers resulted in the ten largest banks in the world all being U.S. banks.
mergers resulted in the 30 largest banks in the world all being U.S. banks.
12. Banks use credit rationing rather than simply raising the interest rate charged borrowers with higher default risks because (Points : 1)
of fear of adverse selection problems.
of interest rate ceilings in many states.
of fear of offending the loan applicants.
use of credit rationing is encouraged by the Federal Reserve.
13. Bank holding companies are (Points : 1)
banks that own nonfinancial companies.
banks that are technically bankrupt but whose assets have not yet been sold off.
nonbank banks.
large companies that hold many different banks as subsidiaries.
14. Which of the following statements concerning movements in the currency-deposit ratio is NOT correct? (Points : 1)
The currency-deposit ratio declined during the early 1930s.
The currency-deposit ratio declined during most of the period from the late nineteenth century through the mid-1960s.
The currency-deposit ratio has generally risen since the late 1960s.
The currency-deposit ratio rose during World War II.
15. A good reason for suspecting the existence of a substantial underground economy is (Points : 1)
the mysterious decline in federal tax revenue in recent years.
the decline in the currency-deposit ratio during the 1970s and 1980s.
the sharp rise in marginal income tax rates during the 1980s.
the large amount of currency outstanding per person.
16. The payments system refers to (Points : 1)
the means of clearing and settling transactions in the economy.
the means by which the government collects taxes.
the system that credit card companies use to collect their payments.
the type of medium of exchange used in the economy.
17. The primary reason the Fed makes discount loans to banks is to (Points : 1)
carry out monetary policy.
help increase bank profitability.
earn interest.
help banks overcome short-term liquidity problems.
18. Congress has attempted to reduce competition among banks in order to (Points : 1)
increase the tax revenues generated from bank profits.
lower interest rates charged on bank loans.
reduce the chance of moral hazard in banks' behavior.
make the process of check clearing easier.
19. The "Member Bank Reserve Changes" data published weekly in The Wall Street Journal is most useful for (Points : 1)
information on sources of change in the monetary base.
gauging whether a particular bank is likely to fail.
gauging the extent to which a particular bank is indebted to the Fed.
forecasting interest rates.
20. During the 1980s, the share of international bank loans held by Japanese banks (Points : 1)
declined.
increased.
remained unchanged.
Japanese banks are not allowed to engage in foreign lending.
Explanation / Answer
Between 1995 and 2000 (Points : 1)
the growth in size of foreign banks meant that the United States no longer had any banks among the 30 largest in the world.
mergers resulted in two U.S. banks becoming among the ten largest in the world.
mergers resulted in the ten largest banks in the world all being U.S. banks.
mergers resulted in the 30 largest banks in the world all being U.S. banks.
12. Banks use credit rationing rather than simply raising the interest rate charged borrowers with higher default risks because (Points : 1)
of fear of adverse selection problems.
of interest rate ceilings in many states.
of fear of offending the loan applicants.
use of credit rationing is encouraged by the Federal Reserve.
13. Bank holding companies are (Points : 1)
banks that own nonfinancial companies.
banks that are technically bankrupt but whose assets have not yet been sold off.
nonbank banks.
large companies that hold many different banks as subsidiaries.
14. Which of the following statements concerning movements in the currency-deposit ratio is NOT correct? (Points : 1)
The currency-deposit ratio declined during the early 1930s.
The currency-deposit ratio declined during most of the period from the late nineteenth century through the mid-1960s.
The currency-deposit ratio has generally risen since the late 1960s.
The currency-deposit ratio rose during World War II.
15. A good reason for suspecting the existence of a substantial underground economy is (Points : 1)
the mysterious decline in federal tax revenue in recent years.
the decline in the currency-deposit ratio during the 1970s and 1980s.
the sharp rise in marginal income tax rates during the 1980s.
the large amount of currency outstanding per person.
16. The payments system refers to (Points : 1)
the means of clearing and settling transactions in the economy.
the means by which the government collects taxes.
the system that credit card companies use to collect their payments.
the type of medium of exchange used in the economy.
17. The primary reason the Fed makes discount loans to banks is to (Points : 1)
carry out monetary policy.
help increase bank profitability.
earn interest.
help banks overcome short-term liquidity problems.
18. Congress has attempted to reduce competition among banks in order to (Points : 1)
increase the tax revenues generated from bank profits.
lower interest rates charged on bank loans.
reduce the chance of moral hazard in banks' behavior.
make the process of check clearing easier.
19. The "Member Bank Reserve Changes" data published weekly in The Wall Street Journal is most useful for (Points : 1)
information on sources of change in the monetary base.
gauging whether a particular bank is likely to fail.
gauging the extent to which a particular bank is indebted to the Fed.
forecasting interest rates.
20. During the 1980s, the share of international bank loans held by Japanese banks (Points : 1)
declined.
increased.
remained unchanged.
Japanese banks are not allowed to engage in foreign lending.
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