Subject: Money and bancking

5. What is the yield curve? a) A graph showing the relationship between bond yields and maturity b) A curve showing the relationship between interest rates and GDP growth c) A measure of the risk of a particular investment d) A curve showing the relationship between inflation and unemployment 6. What does an inverted yield curve indicate? a) A recession is imminent b) Economic growth is likely to accelerate c) Inflation is likely to rise d) Interest rates are likely to stay the same 7. What is a steep yield curve? a) A curve where long-term interest rates are significantly higher than short-term interest rates b) A curve where short-term interest rates are significantly higher than long-term interest rates c) A flat yield curve d) A curve where interest rates remain constant over time 8. What is the most common shape of the yield curve? a) Inverted b) Steep c) Flat d) Upward-sloping 9. What is the Phillips Curve? a) A graph showing the relationship between inflation and unemployment b) A graph showing the relationship between bond yields and bond prices c) A measure of the risk of a particular investment d) A curve showing the relationship between interest rates and GDP growth 10. What is the Great Moderation? a) A period of low volatility in the stock market b) A period of high inflation and economic growth c) A period of low inflation and economic stability d) A period of high unemployment and social unrest 11. What is Okun's Law? a) A law stating that the velocity of money is directly proportional to the money supply b) A law stating that the unemployment rate and GDP growth are inversely related c) A law stating that interest rates and inflation are directly related d) A law stating that the price level and the money supply are directly related 12. What is the Fisher Equation? a) An equation describing the relationship between interest rates and bond prices b) An equation describing the relationship between inflation and unemployment c) An equation describing the relationship between the nominal interest rate, the real interest rate, and inflation d) An equation describing the relationship between the money supply and GDP