#1
Which institution regulates the banking industry in the United States?
Federal Reserve System
ExplanationRegulator of the US banking industry
#2
What is the primary function of a central bank?
All of the above
ExplanationMultiple functions including monetary policy
#3
Which of the following is NOT a primary function of a commercial bank?
Issuing currency
ExplanationNot authorized to issue currency
#4
Which of the following is NOT a function of a central bank?
Regulating fiscal policy
ExplanationNot responsible for fiscal policy regulation
#5
Which of the following is NOT a tool used by central banks to conduct monetary policy?
Fiscal policy
ExplanationNot a monetary policy tool
#6
What does the term 'Reserve Requirement' refer to in banking?
The minimum amount of reserves a bank must hold
ExplanationMinimum reserves for a bank
#7
What is the role of the lender of last resort in banking?
Bailing out failing financial institutions during crises
ExplanationAssisting failing institutions in crises
#8
What is the primary objective of liquidity management in banking?
To ensure sufficient cash and marketable securities to meet obligations
ExplanationEnsuring enough cash and securities for obligations
#9
What is the purpose of a reserve ratio in banking?
To establish the minimum reserves a bank must hold relative to its deposits
ExplanationSetting minimum reserves relative to deposits
#10
Which of the following is NOT a measure of money supply?
GDP
ExplanationNot a measure of money supply
#11
Which of the following is a key objective of reserve management for central banks?
Ensuring liquidity and safeguarding value
ExplanationMaintaining liquidity and value protection
#12
What is the purpose of the Basel III accord in banking regulation?
To establish international standards for bank capital adequacy
ExplanationSetting global bank capital standards
#13
What does the term 'Asset-Liability Management (ALM)' refer to in banking?
Managing a bank's assets and liabilities to minimize risk
ExplanationRisk minimization through managing assets and liabilities
#14
What is the function of the Federal Open Market Committee (FOMC) in the United States?
To conduct monetary policy
ExplanationConducting monetary policy
#15
Which of the following statements about the discount rate is true?
It is set by the Federal Reserve and influences other interest rates
ExplanationSet by the Fed and influences interest rates
#16
What does the term 'Moral Suasion' refer to in the context of central banking?
Using persuasive techniques to influence market participants
ExplanationInfluencing market through persuasion