Chapter 14 – Money, Banking, and Financial Institutions
1. To say money is socially defined means that:
2. Money functions as:
Chapter 14 – Money, Banking, and Financial Institutions
3. If you are estimating your total expenses for school next semester, you are using money
primarily as:
4. If you place a part of your summer earnings in a savings account, you are using money
primarily as a:
5. If you write a check on a bank to purchase a used Honda Civic, you are using money
primarily as:
Chapter 14 – Money, Banking, and Financial Institutions
6. A $70 price tag on a sweater in a department store window is an example of money
functioning as a:
7. Stock market price quotations best exemplify money serving as a(n):
8. Purchasing common stock by writing a check best exemplifies money serving as a(n):
Chapter 14 – Money, Banking, and Financial Institutions
9. When economists say that money serves as a medium of exchange, they mean that it is:
10. When economists say that money serves as a unit of account, they mean that it is:
11. When economists say that money serves as a store of value, they mean that it is:
Chapter 14 – Money, Banking, and Financial Institutions
12. The paper money used in the United States is:
13. In the United States, the money supply (M1) is comprised of:
14. Currency held in the vault of First National Bank is:
Chapter 14 – Money, Banking, and Financial Institutions
15. Checkable deposits are classified as money because:
16. Currency (paper money plus coins) constitutes about:
17. In January 2010, the supply of money (M1) in the United States was about:
Chapter 14 – Money, Banking, and Financial Institutions
18. To say that coins are “token money” means that:
19. In defining money as M1, economists exclude time deposits because:
20. Which of the following is not part of the M2 money supply?
Chapter 14 – Money, Banking, and Financial Institutions
21. The M2 money supply includes:
22. A checking account entry is money because it:
23. Currency in circulation is part of:
Chapter 14 – Money, Banking, and Financial Institutions
24. Money market deposit accounts are included in:
25. Checkable deposits are:
26. The amount of money reported as M2:
Chapter 14 – Money, Banking, and Financial Institutions
27. The largest component of the money supply (M1) is:
28. Paper money (currency) in the United States is issued by the:
29. A $20 bill is a:
Chapter 14 – Money, Banking, and Financial Institutions
30. Coins in people’s pockets and purses are:
31. Coins held in commercial banks are:
32. Checkable deposits include:
Chapter 14 – Money, Banking, and Financial Institutions
33. The difference between M1 and M2 is that:
34. Assuming no other changes, if checkable deposits increase by $40 billion and currency in
circulation decreases by $40 billion, the:
35. Assuming no other changes, if checkable deposits decrease by $40 billion and balances in
money market mutual funds increase by $40 billion, the:
Chapter 14 – Money, Banking, and Financial Institutions
36. “Near-monies” are included in:
37. Assuming no other changes, if balances in money market deposit accounts increase by
$50 billion and small-denominated time deposits decrease by $50 billion, the:
38. Small-denominated time deposits, by definition:
Chapter 14 – Money, Banking, and Financial Institutions
39. The near-money components of M2 are:
40. The M2 money supply is about ________ times larger than the M1 money supply.
41. Near-monies:
Chapter 14 – Money, Banking, and Financial Institutions
42. Refer to the above information. Money supply M1 for this economy is:
43. Refer to the above information. Money supply M2 for this economy is:
Chapter 14 – Money, Banking, and Financial Institutions
44. Refer to the above information. The value of the “near-monies” that are part of M2 is:
Answer the question on the basis of the following list of assets:
1. Large-denominated ($100,000 and over) time deposits
2. Noncheckable savings deposits
3. Currency (coins and paper money) in circulation
4. Small-denominated (under $100,000) time deposits
5. Stock certificates
6. Checkable deposits
7. Money market deposit accounts
8. Money market mutual fund balances held by individuals
9. Money market mutual fund balances held by businesses
10. Currency held in bank vaults
45. Refer to the above list. The M1 definition of money comprises item(s):
Chapter 14 – Money, Banking, and Financial Institutions
46. Refer to the above list. The M2 definition of money comprises:
47. Refer to the above list. The assets that are not included in either M1 or M2 are:
48. Refer to the above list. Which of the following are considered to be “near-monies?”
Chapter 14 – Money, Banking, and Financial Institutions
49. Time deposits of $100,000 or more are:
50. Currency held within banks is part of:
51. The money supply is backed:
Chapter 14 – Money, Banking, and Financial Institutions
52. Which of the following does not explain what backs the money supply in the United
States?
53. Suppose that the Federal government suddenly declared that wheat was to be used as
money. What is a possible outcome of that decision?
54. The purchasing power of money and the price level vary:
Chapter 14 – Money, Banking, and Financial Institutions
55. The value of money varies:
56. If the price index rises from 100 to 120, the purchasing power value of the dollar:
57. If the price index rises from 200 to 250, the purchasing power value of the dollar: