1. Which of the following combination of assets are considered to be money? curr

Question

1. Which of the following combination of assets are considered to be money?
       currency in circulation, checkable bank deposits, and credit cards
       currency in circulation, checkable bank deposits, and travelers' checks
       currency in circulation and in bank vaults, checkable bank deposits, and travelers' checks
       currency in circulation and in bank vaults, checkable bank deposits, and credit cards


2. When countries replaced gold and silver coins with paper money exchangeable for certain amounts of precious metals, the monetary system evolved from _______.
       using commodity money to using fiat money
       using commodity-backed money to using fiat money
       using commodity money to using commodity-backed money
       using fiat money to using commodity-backed money


3. Banks can lend money because ______.
       they have so much to lend
       they know not everyone wants their deposits back at the same time
       there is a high demand for loans
       they know how much cash they have in their vault


4. Banks create money when they ______.
       make loans
       take deposits
       hold excess reserves
       pay withdrawals to depositors


5. To change the money supply, the Fed most frequently uses _______.
       changes in the required reserve ratios
       changes in the discount rate
       open-market operations
       none of the above


6. An increase in the aggregate price _______.
       increases the nominal demand for money
       decreases the nominal demand for money
       does not affect the nominal demand for money
       shifts the nominal demand for money to the left


7. The loanable funds model focuses on the ______.
       demand for money
       supply of funds from lenders
       supply of funds from borrowers and the demand by lenders
       supply of funds from lenders and the demand from borrowers


8. Expansionary monetary policy _______.
       increases the money supply, interest rates, consumption, and investment
       decreases the money supply, interest rates, consumption, and investment
       increases the money supply, decreases interest rates, and increases consumption and investment
       decreases the money supply, increases interest rates, and decreases consumption and investment


9. In the long run, changes in the money supply _______.
       affect both the aggregate price level and aggregate output
       affect only the price level but they do not change aggregate output
       affect aggregate output but not the aggregate price level
       have no impact on either the aggregate price level or aggregate output


10. All of the following factors shift the real money demand curve to the right except a(n) _______.
       decrease in the number of stores accepting credit cards
       increase in the price level
      

Explanation / Answer

Answer: BCBAC ADCBB

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