Prof jim only | Business & Finance homework help

Question 1

An organization that provides loans directly to consumers and businesses or aid individuals in obtaining financing for durable goods is called a (n)

Answer

[removed]		commercial bank
[removed]		investment bank
[removed]		savings and loan
[removed]		finance company

2 points

Question 2

The holding-company device to control two or more commercial banks:

Answer

[removed]		has diminished in importance in recent years
[removed]		has increased in importance in recent years
[removed]		is limited to state chartered banks
[removed]		is sometimes described as chain banking

2 points

Question 3

The item on the assets side of a bank’s balance sheet that represents the largest proportion of bank assets is:

Answer

[removed]		deposits
[removed]		owner’s capital
[removed]		securities
[removed]		loans

2 points

Question 4

Capital notes:

Answer

[removed]		are subject to reserve requirements
[removed]		are assets of the banks that issue them
[removed]		are always subordinated to the claims of bank depositors
[removed]		reflect short-term borrowing on the part of the bank

2 points

Question 5

During the colonial period in the nation’s history, banks depended on:

Answer

[removed]		their own issue of paper money
[removed]		foreign sources for their loanable funds
[removed]		deposits of foreign currency such as the Spanish dollar
[removed]		the investment of their own stockholders

2 points

Question 6

Legislation that provided for the separation of commercial banking and investment banking activities in the United States is called

Answer

[removed]		Garn–St. Germain Depository Institutions Act
[removed]		Glass-Steagall Act
[removed]		Hunt Commission legislation
[removed]		Depository Institutions Deregulation and Monetary Control Act

2 points

Question 7

Primary reserves

Answer

[removed]		include the cash assets of the firm under the heading “cash and balances due from depository institutions.
[removed]		are short term securities held by banks that are quickly converted into cash at little cost to the banks.
[removed]		reflects the bank’s ability to meet depositor withdrawals.
[removed]		reflects the bank’s ability to keep the value of a bank’s assets greater than its liabilities.

2 points

Question 8

The principal assets of banks do not include:

Answer

[removed]		cash
[removed]		loans
[removed]		time deposits
[removed]		securities owned

2 points

Question 9

Our system of national banks:

Answer

[removed]		was designed to destroy state banking
[removed]		was an integral part of the Federal Reserve Act
[removed]		was replaced by Federal Reserve banking
[removed]		came into existence during the Civil War

2 points

Question 10

Commercial banks obtain the bulk of their loanable funds from:

Answer

[removed]		depositors
[removed]		the issue of certificates of deposit
[removed]		sale of bank stock
[removed]		sale of subordinated debenture bonds

2 points

Question 11

The Fed shares its depository examining functions with:

Answer

[removed]		the Federal Savings and Loan Insurance Corporation
[removed]		the FDIC, Comptroller of the Currency, and state agencies
[removed]		only the Comptroller of the Currency
[removed]		National Credit Union administration and the FDIC

2 points

Question 12

The Federal Open Market Committee:

Answer

[removed]		typically buys and sells long-term corporate bonds
[removed]		is the most powerful and flexible monetary policy tool of the Fed
[removed]		works out of Washington D.C.
[removed]		deals with most of the commercial banks of the nation

2 points

Question 13

The dynamic actions of the Federal Reserve System:

Answer

[removed]		contribute to the smooth everyday functioning of the economy
[removed]		are designed to meet the credit needs of individuals and institutions
[removed]		support depositories and other institutions
[removed]		stimulate or repress the level of prices or economic activity

2 points

Question 14

The banking system of the United States is a ___________ reserve system because banks are required by the Fed to hold reserves equal to a specified percentage of their deposits.

Answer

[removed]		required
[removed]		fractional
[removed]		proportional
[removed]		multiplicative

2 points

Question 15

The Truth in Lending Act:

Answer

[removed]		prohibits discrimination in the granting of credit on the basis of sex, race, color, and religion
[removed]		limits liability on lost or stolen credit cards
[removed]		prohibits unfair or deceptive acts or practices on the part of banks
[removed]		requires prompt correction of errors on a revolving charge account

2 points

Question 16

The Federal Reserve Banks are owned by:

Answer

[removed]		commercial banks
[removed]		the U.S. Treasury
[removed]		national member banks of the Federal Reserve System
[removed]		member banks of the Federal Reserve System

2 points

Question 17

The primary function of the Federal Reserve System is to:

Answer

[removed]		issue currency to member banks
[removed]		regulate the growth of the money supply
[removed]		serve as a fiscal agent for the U.S. government
[removed]		regulate and conduct bank examinations

2 points

Question 18

__________________ become the most important and effective means of monetary and credit control.

Answer

[removed]		Changing reserve requirements has
[removed]		Changing the discount rate has
[removed]		Open market operations has
[removed]		Changing the Treasury bill rate has

2 points

Question 19

The central bank in the United Kingdom is the:

Answer

[removed]		Bank of Britain
[removed]		British Fed
[removed]		British Bank
[removed]		Bank of England

2 points

Question 20

The members of the Fed Board of Governors are:

Answer

[removed]		elected by the member banks
[removed]		appointed by the President of the United States with the advice and consent of the Senate
[removed]		appointed by the Secretary of the Treasury
[removed]		appointed by each of the Federal Reserve banks

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