A Quiz On Ch 13 Money And Banking

10 Questions

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A Quiz On Ch 13 Money And Banking

The world today is becoming a cashless economy and everyone is embracing the use of banks to keep our money and using debit and credit notes. Have you read chapter 13 of McConnell and Brue on money and banking? Take the review test below and refresh your memory on the topic.


Questions and Answers
  • 1. 
    • A. 

      True

    • B. 

      False

  • 2. 
    The money supply designated M1 is the sum of currency and noncheckable deposits.
    • A. 

      True

    • B. 

      False

  • 3. 
    The currency component of M1 includes both coins and paper money.
    • A. 

      True

    • B. 

      False

  • 4. 
    If a coin is token money, its face value is less than its intrinsic value.
    • A. 

      True

    • B. 

      False

  • 5. 
    Both commercial banks and thrift institutions accept checkable deposits.
    • A. 

      True

    • B. 

      False

  • 6. 
    The checkable deposit of the Federal government at the Federal Reserve Banks are a component of M1.
    • A. 

      True

    • B. 

      False

  • 7. 
    M2 exceeds M1 by the amount of noncheckable savings, small time deposits, and money market deposit accounts and money market mutual funds.
    • A. 

      True

    • B. 

      False

  • 8. 
    A small time deposit is one that is less than $100,000.
    • A. 

      True

    • B. 

      False

  • 9. 
    M2 is less than M3 by the amount of small time deposits in depository institutions.
    • A. 

      True

    • B. 

      False

  • 10. 
    Economists and public officials are in general agreement on how to define the money supply in the U.S.
    • A. 

      True

    • B. 

      False