1.A Banks holding of deposits in accounts with the Fed, plus currency that is physically held by banks is called______ A. Discount Window B. Reserves C. Policy Instruments D. Federal Reserve Banks 2. ________is a variable that is very responsive to the central banks tools and indicates a stance of monetary policy A. Discount Window B. Reserves C. Policy Instruments D. Federal Reserve Banks 3. The Federal Reserve facility at which discount loans are made to banks is______ A. Discount Window B. Reserves C. Policy Instruments D. Federal Reserve Banks 4. _____ is the 12 district banks in the Federal Reserve System. A. Discount Window B. Reserves C. Policy Instruments D. Federal Reserve Banks 5. The interest rate that the Federal Reserve charges banks on discount loans? A. Federal Funds Rate B. Policy Instruments C. Discount Rate D. Discount Window 6. The interest rate on overnight loans of deposits at the Federal Reserve is____ A. Federal Funds Rate B. Policy Instruments C. Discount Rate D. Discount Window 7. Companies that own one or more banks is labeled as a ________ A. Open Market Operations B. Monetary Union C. Bank Holding Companies D. Federal Open Market Committee 8. _____ is the buying and selling of government securities in the open market that affect both interest rates and the number of reserves in the banking system A. Open Market Operations B. Monetary Union C. Bank Holding Companies D. Federal Open Market Committee 9. _____ is considered low and stable inflation in the economy A. Opportunity Costs B. Standing Lending Facility C. Price Stability D. Deposit Outflows 10. The amount of interest sacrificed by not holding an alternative asset is_______ A. Opportunity Costs B. Standing Lending Facility C. Price Stability D. Deposit Outflows 11. ______ is a loss of deposits when depositors make withdrawals or demand payment A. Opportunity Costs B. Standing Lending Facility C. Price Stability D. Deposit Outflows 12. A lending facility in which healthy banks are allowed to borrow all the want from a central bank is________ A. Opportunity Costs B. Standing Lending Facility C. Price Stability D. Deposit Outflows 13.________ is a market in which securities can be bought and sold quickly with low transaction costs A. Competitive bidding B. Roll Over C. Liquid Market D. Asset-Backed Commercial Paper 14. What is the term to renew a debt when it matures? A. Competitive bidding B. Roll Over C. Liquid Market D. Asset-Backed Commercial Paper 15. ______ is a short-term commercial paper secured by a bundle of assets, usually mortgages A. Competitive bidding B. Roll Over C. Liquid Market D. Asset-Backed Commercial Paper 16. _____ is the definition of when banks are in an auction of other potential buyers of Treasury Securities A. Competitive bidding B. Roll Over C. Liquid Market D. Asset-Backed Commercial Paper 17. A short-term promissory note drawn by a company to pay goods on which a bank guarantees payment at maturity is______ A. Direct Placement B. Wholesale Markets C. Bankers Acceptance D. Securitized Mortgage 18. ______ is a market where extremely large transactions occur, as for money market funds or foreign currency A. Demand Deposits B. Wholesale Markets C. Bankers Acceptance D. Securitized Mortgage 19. Which term is another term for a checking account? A. Demand Deposits B. Wholesale Markets C. Bankers Acceptance D. Securitized Mortgage 20. ______ is a security that is collateralized by a pool of mortgage loans A. Demand Deposits B. Wholesale Markets C. Bankers Acceptance D. Securitized Mortgage 21.______ is the possible reduction in returns that are associated with the changes in interest rates A. Financial Guarantee D. Premium C. Interest-Rate Risk D. Sinking Fund 22. A contract that guarantees the bond purchasers will be paid both principal and interest in the event the issuer defaults on the obligation is_______ A. Financial Guarantee D. Premium C. Interest-Rate Risk D. Sinking Fund 23. _______ is the amount paid for an option contract A. Financial Guarantee D. Premium C. Interest-Rate Risk D. Sinking Fund 24. When the bond sells for less than the par value, it is sold on a _______ A. Appreciation B. Zero-Coupon Security C. Discount D. Sinking Fund 25. _____ is the increase in a currencys value A. Appreciation B. Zero-Coupon Security C. Discount D. Sinking Fund 26. A corporations first sale of securities to the public is an______ A. Premium B. IPO C. Stock Option D. Call Provision 27.______ is an option to purchase individual stock A. Premium B. IPO C. Stock Option D. Call Provision 28. The total value of a mutual funds assets minus any liabilities, divided by the number of shares outstanding is called______ A. Ask Price B. Price Earnings Ratio C. Net Asset Value D. Bid Price 29. _____ is the price market makers pay for stocks A. Ask Price B. Price Earnings Ratio C. Net Asset Value D. Bid Price 30. What measures how much the market is willing to pay for $1 of earnings from a firm? A. Ask Price B. Price Earnings Ratio C. Net Asset Value D. Bid Price 31. The price market makers sell the stock for is_____ A. Ask Price B. Price Earnings Ratio C. Net Asset Value D. Bid Price 32. ______ are loans made to borrowers who do not qualify for loans at the usual rate of interest due to poor credit rating or too large of a loan amount A. Collateralized Mortgage Obligation B. Mortgage-Backed Security C. Private Mortgage Insurance D. Subprime Loans 33. A security that is collateralized by a pool of mortgage loans is called______ A. Collateralized Mortgage Obligation B. Mortgage-Backed Security C. Private Mortgage Insurance D. Subprime Loans 34. ______is insurance that protects the lender against losses from defaults on mortgage loans A. Collateralized Mortgage Obligation B. Mortgage-Backed Security C. Private Mortgage Insurance D. Subprime Loans 35. Securities classified by when prepayment is likely to occur is referred to as what? A. Collateralized Mortgage Obligation B. Mortgage-Backed Security C. Private Mortgage Insurance D. Subprime Loans 36. What is a long-term loan secured by real estate? A. Lien B. Conventional Mortgage C. Mortgage D. Insured Mortgages 37. _____ is a legal claim against a piece of property that gives a lender the right to foreclose or seize the property if a loan on the property is not repaid as promised A. Lien B. Conventional Mortgage C. Mortgage D. Insured Mortgages 38. Mortgages guaranteed by either the Federal Housing Administration or Veterans Administration are considered_____ A. Lien B. Conventional Mortgage C. Mortgage D. Insured Mortgages 39. ______ are mortgage contracts originated by banks and other mortgage lenders that are not guaranteed by the FHA or VA. (Often insured by Private Mortgage Insurance) A. Lien B. Conventional Mortgage C. Mortgage D. Insured Mortgages 40.______ are the expenses incurred from a banks ongoing operations A. Required Reserves B. Interest-rate risk C. Liability Management D. Operating Expenses 41. ______ are held to meet Fed Requirements that a certain fraction of bank deposits must be kept as reserves A. Required Reserves B. Interest-rate risk C. Liability Management D. Reserve Requirements 42. Regulations making it obligatory for depository institutions to keep a certain fraction of their deposits in Federal Accounts is called_______ A. Required Reserves B. Interest-rate risk C. Liability Management D. Reserve Requirements 43. The acquisition of funds are low cost to increase profits is_________ A. Required Reserves B. Interest-rate risk C. Liability Management D. Reserve Requirements 44._______ is the possible reduction in returns that is associated with changes in interest rates A. Required Reserves B. Interest-rate risk C. Liability Management D. Reserve Requirements 45. _____ are the Banks holding of deposits in accounts with the Fed, plus currency that is physically held by the banks A. Deposit Outflows B. Secondary Reserves C. Reserves D. Money center banks 46. U.S. government and agency securities held by banks are called________ A. Deposit Outflows B. Secondary Reserves C. Reserves D. Money center banks 47.____ is a form of electronic money used on the internet to pay for goods and services A. ATM B. Virtual Bank C. E-cash D. Electronic Money 48. The system in the United States in which banks are supervised by the federal government and by the states they operate in is called______ A. Federal Reserve System B. National Banks C. Dual Banking System D. Virtual Bank 49. _____ is the central banking authority responsible for monetary policy in the United States A. Federal Reserve System B. National Banks C. Dual Banking System D. Virtual Bank 50. A bank that has no building but rather exists only in cyberspace is called______ A. Federal Reserve System B. National Banks C. Dual Banking System D. Virtual Bank 51. _______ is a small bank with local roots A. National Banks B. Superregional Banks C. Community Banks D. Virtual Banks 52._______ is a federally chartered bank A. National Banks B. Superregional Banks C. Community Banks D. Virtual Banks 53. Bank holding companies similar in size to money center banks whose headquarters are not based in one of the money center cities is________ A. National Banks B. Superregional Banks C. Community Banks D. Virtual Banks