Q1: Financial markets and institutions (a) involve the movement of huge flows of money. (b) affect the profits of businesses. (c) affect the types of goods and services produced in an economy. (d) do each of the above. (e) do only (a) and (b) of the above. Q2: Markets in which funds are transferred from those who have excess funds available to those who have a shortage of available funds are called (a) commodity markets. (b) fund-available markets. (c) derivative exchange markets. (d) financial markets. Q3: Financial markets promote economic efficiency by (a) channeling funds from investors to savers. (b) creating inflation. (c) causing recessions. d) channeling funds from savers to investors. (e) reducing investment. Q4: Well-functioning financial markets promote (a) inflation. (b) deflation. (c) unemployment. (d) growth. (e) none of the above. Q5: Poorly performing financial markets can be the cause of (a) wealth. (b) poverty. (c) financial stability. (d) all of the above. (e) none of the above.Q6: An increase in interest rates on student loans {a} increases the cost of a college education. {b} reduces the cost of a college education. {c} has no effect on educational costs. {d} increases costs for students with no loans. {e} none of the above. QT: Interest rates a'ect {a} individuals. {b} businesses. {c} the overall economy. {d} all of the above. {e} only [b] and {c} of the above. Q8: Changes in stock prices {a} affect people's weal'i and their willingness to spend {b} affect firms' decisions to sell stock to fu'iance investment spending. {c} are characterised by considerable uctuations. {d} all of the above. {e} only {a} and [b] of the above. Q9: The price of one country's currency in terms of another's is called {a} the exchange rate. {b} the interest rate. {c} the Dow Jones industrial average. {d} none of the above. Q10: A change in the exchange rate has a direct effect on Americans because it affects {a} the price of foreign goods to American consumers. {b} the price of American goods to foreign consumers. {c} the price Americans will pay to travel abroad. {d} the price foreigners will pay to travel to the HE. {e} all of the above