#1
Which of the following is not a function of money in an economy?
Medium of exchange
Unit of account
Store of wealth
Resource allocation
#2
Which of the following is not a characteristic of a central bank?
Independence from political influence
Regulation of commercial banks
Profit-maximizing motive
Issuance of currency
#3
What does M1 measure in a country's money supply?
Currency in circulation and demand deposits
Currency in circulation and time deposits
Currency in circulation only
Total cash and savings deposits
#4
Which of the following institutions regulates the monetary policy in the United States?
Federal Reserve
US Treasury
World Bank
International Monetary Fund
#5
What is the term for a situation in which the money supply grows faster than the economy?
Hyperinflation
Deflation
Stagflation
Inflation
#6
What is the name for a monetary system where the value of the currency is tied to a specific amount of gold?
Fiat money system
Commodity money system
Gold standard
Bretton Woods system
#7
What is the primary tool used by central banks to control the money supply?
Fiscal policy
Interest rate manipulation
Foreign exchange market intervention
Printing more currency
#8
Which of the following is a characteristic of deflation?
Rising prices
Increased consumer spending
Decreased money supply
Falling prices
#9
In the context of monetary policy, what does the term 'open market operations' refer to?
Government's control over foreign exchange markets
Buying and selling of government securities
Setting interest rates on loans to commercial banks
Direct control over banks' reserve requirements
#10
What is the term for the interest rate at which the Federal Reserve lends to commercial banks?
Discount rate
Federal funds rate
Prime rate
LIBOR
#11
Under a pegged exchange rate system, what does a central bank do to maintain the value of its currency?
Allow the currency to float freely
Intervene in the foreign exchange market
Print more currency
Decrease interest rates
#12
What is the primary goal of expansionary monetary policy?
Stabilizing prices
Increasing unemployment
Reducing government spending
Stimulating economic growth
#13
Which of the following is a tool of expansionary fiscal policy?
Decreasing government spending
Increasing taxes
Reducing money supply
Increasing government spending
#14
What is the name for a sudden, drastic reduction in the value of a currency?
Depreciation
Appreciation
Devaluation
Inflation