#1
Which of the following is NOT a function of money?
Medium of exchange
Store of value
Unit of labor
Unit of account
#2
Which of the following is an example of a fiat currency?
Gold coins
Silver bars
Bitcoin
U.S. dollar
#3
What is the function of the Federal Deposit Insurance Corporation (FDIC)?
To regulate interest rates
To ensure the safety of bank deposits
To conduct monetary policy
To supervise the stock market
#4
Which of the following is a function of central banks?
Issuing bonds
Regulating the stock market
Conducting monetary policy
Providing insurance
#5
What is the term for the total amount of money circulating in an economy?
Liquidity ratio
Money supply
Reserve requirement
Interest rate
#6
What does M1 measure in the money supply?
Currency, demand deposits, and traveler's checks
Currency and coins in circulation
Savings deposits and money market funds
All of the above
#7
Which of the following is an example of expansionary monetary policy?
Decreasing the reserve requirement
Increasing taxes
Decreasing government spending
Selling government securities
#8
What is the role of the Federal Reserve in the U.S. banking system?
Issuing currency
Regulating banks
Conducting monetary policy
All of the above
#9
What is the function of the discount rate set by the central bank?
To encourage banks to borrow from each other
To discourage banks from borrowing from each other
To regulate the interest rates on mortgages
To regulate the interest rates at which banks borrow from the central bank
#10
What is the term for the interest rate at which banks lend reserves to other banks?
Discount rate
Federal funds rate
Prime rate
LIBOR
#11
What is the term for the process of creating money through lending activities of banks?
Fractional reserve banking
Monetary easing
Quantitative tightening
Fractional reserve lending
#12
What is the primary tool used by central banks to influence the money supply?
Fiscal policy
Open market operations
Foreign exchange interventions
Tariffs
#13
What is the concept of 'fractional reserve banking'?
A system where banks hold reserves equal to 100% of their deposits
A system where banks lend out a fraction of their deposits
A system where banks only accept deposits in fractions
A system where banks have no reserve requirements
#14
What is the primary purpose of conducting open market operations by central banks?
To directly control inflation rates
To regulate the money supply
To stabilize foreign exchange rates
To intervene in the stock market
#15
Which of the following is an example of a central bank's macroprudential policy?
Setting interest rates
Regulating banks' capital requirements
Supervising individual banks
Stabilizing exchange rates
#16
Which of the following is an example of a central bank's microprudential policy?
Conducting open market operations
Regulating interest rates
Supervising individual banks
Intervening in foreign exchange markets
#17
What is the main purpose of the Basel III regulations?
Preventing bank runs
Stabilizing exchange rates
Reducing systemic risk in the banking sector
Controlling inflation