1. As of August 1, 2020, US Government bond 10- year interest rates and the Fed funds rates,in decimals, are rate are closest to

   1. .0055 and 0.00 respectively

   2. .055 and .0125 respectively

   3. .0005 and .125 respectively

   4. 5.5 and 1.25 respectively

   5. Question

      1. Add liquidity and raise risk premiums

      2. Add liquidity and reduce risk premiums

      3. Drain liquidity and reduce risk premiums

      4. Drain liquidity and raise risk premiums

2. Objectives of the Federal Reserves Quantitative Easing (QE) programme include

• Question 8

  The monetary base is best described as currency in circulation plus

  1. Total bank liabilities

  2. Total bank assets

  3. Amounts due on outstanding credit card debt

  4. Total bank reserves held at the Federal reserve

• Question 9

  In the immediate aftermath of a financial crisis or a steep recession, the federal Reserve is most likely to

  1. Leave monetary condition unchanged

  2. Tighten monetary conditions

  3. Ease monetary conditions

  4. Raise taxes

• Question 10

  Many banks take illiquid assets, such as loans, and transform them into liquid tradable securities. This process is called

  1. Securitization

  2. On-balance sheet financing

  3. Mortgage origination

  4. MArket -making

• Question 11

  Non-bank financial intermediaries, called shadow banks, that provides services similar to traditional depository institutions are

  1. Highly regulated and have access to the Fed s borrowing facilities

  2. Lightly regulated and have access to the Feds borrowing facilities

  3. Lightly regulated but do not have access to the Feds borrowing facilities

  4. Highly regulated but do not have access to the Feds borrowing facilities

• Question 12

  Quicken Loans, Lending Tree and Robin Hood are examples of

  1. Shadow banks

  2. Hedge funds

  3. Depository institutions

  4. Mutual funds