BÀI TẬP BỔ SUNG – CHƯƠNG 1 – ÔN TẬP

1/ Well-functioning financial markets promote

a/ deflation.
b/ growth.
c/ unemployment.
d/ inflation.

2/ Markets in which funds are transferred from those who have excess funds available to those
who have a shortage of available funds are called
a/ fund-available markets.
b/ financial markets.
c/ derivative exchange markets.
d/ commodity markets.

3/ Poorly performing financial markets can be the cause of

a/ wealth.
b/ poverty.
c/ financial stability.
d/ financial expansion.

4/ The price paid for the rental of borrowed funds (usually expressed as a percentage of the rental
of $100 per year) is commonly referred to as the
a/ exchange rate.
b/ interest rate.
c/ inflation rate.
d/ aggregate price level.

5/ Everything else held constant, a decline in interest rates will cause spending on housing to
a/ remain unchanged.
b/ rise.
c/ either rise, fall, or remain the same.
d/ fall.

6/ High interest rates might ________ purchasing a house or car but at the same time high
interest rates might ________ saving.
a/ discourage; discourage
b/ encourage; encourage
c/ encourage; discourage
d/ discourage; encourage

7/ High interest rates might cause a corporation to ________ building a new plant that would
provide more jobs.
a/ consider
b/ complete
c/ contemplate
d/ postpone

8/ Channeling funds from individuals with surplus funds to those desiring funds when the saver
does not purchase the borrower's security is known as
a/ redistribution.
b/ barter.
c/ taxation.
d/ financial intermediation.

9/ A financial crisis is
a/ not possible in the modern financial environment.
b/ a feature of developing economies only.
c/ typically followed by an economic boom.
d/ a major disruption in the financial markets.

10/ Banks________________
a/ produce nothing of value and are therefore a drain on society's resources.
b/ are the only financial institutions allowed to give loans.
c/ hold very little of the average Nation's wealth.
d/ provide a channel for linking those who want to save with those who want to invest.

11/ The delivery of financial services electronically is called

a/ e-finance.
b/ e-commerce.
c/ e-business.
d/ e-possible.

12/ Money is defined as

a/ anything that is generally accepted in payment for goods or services or in the repayment of
debt.
b/ bills of exchange.
c/ a risk-free repository of spending power.
d/ the unrecognized liability of governments.

13/ ________ theory relates the quantity of money and monetary policy to changes in aggregate
economic activity and inflation.
a/ Monetary
b/ Fiscal
c/ Financial
d/ Systemic

14/ A continuing increase in the growth of the money supply is likely followed by
a/ an inflation.
b/ a depression.
c/ a recession.
d/ no change in the economy.

15/ ________ policy involves decisions about government spending and taxation.
a/ Fiscal
b/ Monetary
c/ Financial
d/ Systemic

16/ When tax revenues are greater than government expenditures, the government has a budget
a/ deficit.
b/ crisis.
c/ surplus.
d/ revision.

17/ A budget ________ occurs when government expenditures exceed tax revenues for a
particular time period.
a/ surplus
b/ surge
c/ deficit
d/ surfeit

18/ The gross domestic product is the

a/ the value of all goods and services sold to other nations in a year.
b/ the value of all wealth in an economy.
c/ the market value of all final goods and services produced in an economy in a year.
d/ the market value of all intermediate goods and services produced in an economy in a year.

19/ Changes in stock prices

a/ do not affect people's wealth and their willingness to spend.
b/ occur in regular patterns.
c/ affect firms' decisions to sell stock to finance investment spending.
d/ are unimportant to decision makers.

20/ Banks are important to the study of money and the economy because they
a/ channel funds from investors to savers.
b/ are the only important financial institution in the U.S. economy.
c/ have been a source of rapid financial innovation.
d/ create inflation.

21/ Which of the following is NOT a financial institution?

a/ a business college
b/ a pension fund
c/ a credit union
d/ a life insurance company
22/ Everything else constant, a stronger money will mean that
a/ vacationing in foreign country becomes less expensive.
b/ vacationing in foreign country becomes more expensive.
c/ foreign cheese becomes more expensive.
d/ foreign cars become more expensive.

23/ Everything else held constant, a stronger money benefits ________ and hurts ________.
a/ Local consumers; Local businesses
b/ Local businesses; foreign businesses
c/ Local businesses; Local consumers
d/ foreign businesses; Local consumers

24/ Question 41:

Compared to interest rates on long-term U.S. government bonds, interest rates on three-month
Treasury bills fluctuate ________ and are ________ on average.
a/ more; lower
b/ less; lower
c/ more; higher
d/ less; higher

25/ Everything else held constant, an increase in interest rates on student loans
a/ increases the cost of a college education.
b/ reduces the cost of a college education.
c/ has no effect on educational costs.
d/ increases costs for students with no loans.

26/ When stock prices fall

a/ an individual's wealth may decrease and their willingness to spend may decrease.
b/ a business firm will be more likely to sell stock to finance investment spending.
c/ an individual's wealth may decrease but their willingness to spend is not affected.
d/ an individual's wealth is not affected nor is their willingness to spend.

27/ It is true that inflation is a

a/ continually rising price level.
b/ continuous fall in prices.
c/ decline in interest rates.
d/ continuous increase in the money supply.

28/ The bond markets are important because they are

a/ the markets where interest rates are determined.
b/ the markets where foreign exchange rates are determined.
c/ easily the most widely followed financial markets in the United States.
d/ the markets where all borrowers get their funds.

29/ The stock market is

a/ the most widely followed financial market on the world.
b/ where interest rates are determined.
c/ where foreign exchange rates are determined.
d/ the market where most borrowers get their funds.

30/ Stock prices are

a/ extremely volatile.
b/ relatively stable trending downward at a moderate rate.
c/ relatively stable trending upward at a steady pace.
d/ unstable trending downward at a moderate rate.