Test Bank for The Economics of Money, Banking and Financial Markets, 13th Edition by Mishkin
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Economics of Money, Banking and Financial
Institution
Economics Of Money, Banking And Financial
Test Bank for The Economics of Money, Banking and Financial Markets, 13e 13th Edition by Frederic Mishkin. ISBN-13: 4353 Full chapters test bank in PDF PART I: INTRODUCTION 1. Why Study Money, Banking, and Financial Markets? 2. An Overview of the Financial System 3. What Is Money? PART II: FINANCIA...
TEST BANK FOR: ALL CHAPTERS
The Economics of Money, Banking and Financial Markets, 13e (Mishkin)
Chapter 1 Why Study Money, Banking, and Financial Markets?
1.1 Why Study Financial Markets? ANSWERS INCLUDED ✅
1) Financial markets promote economic efficiency by
A) channeling funds from investors to savers.
B) creating inflation.
C) channeling funds from savers to investors.
D) reducing investment.
R
Answer: C
Question Status: Previous Edition
U
AACSB: Reflective Thinking
SE
2) Financial markets promote greater economic efficiency by channeling funds from
to .
A) investors; savers
B) borrowers; savers
C) savers; borrowers
D) savers; lenders IS
O
Answer: C
Question Status: Previous Edition
AACSB: Reflective Thinking
N
3) Well-functioning financial markets promote
N
A) inflation.
B) deflation.
O
C) unemployment.
D) growth.
C
Answer: D
Question Status: Previous Edition
ED
AACSB: Reflective Thinking
4) A key factor in producing high economic growth is
A) eliminating foreign trade.
M
B) well-functioning financial markets.
C) high interest rates.
D) stock market volatility.
Answer: B
Question Status: Previous Edition
AACSB: Reflective Thinking
,5) 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.
Answer: D
Question Status: Previous Edition
AACSB: Application of Knowledge
6) markets transfer funds from people who have an excess of available funds to people
R
who have a shortage.
A) Commodity
U
B) Fund-available
C) Financial
SE
D) Derivative exchange
Answer: C
Question Status: Previous Edition
AACSB: Application of Knowledge
IS
7) Poorly performing financial markets can be the cause of
A) wealth.
O
B) poverty.
C) financial stability.
N
D) financial expansion.
Answer: B
N
Question Status: Previous Edition
AACSB: Reflective Thinking
O
8) The bond markets are important because they are
C
A) easily the most widely followed financial markets in the United States.
B) the markets where foreign exchange rates are determined.
ED
C) the markets where interest rates are determined.
D) the markets where all borrowers get their funds.
Answer: C
Question Status: Previous Edition
M
,10) Compared to interest rates on long-term U.S. government bonds, interest rates on three-
month Treasury bills fluctuate and are on average.
A) more; lower
B) less; lower
C) more; higher
D) less; higher
Answer: A
Question Status: Previous Edition
AACSB: Reflective Thinking
R
11) The interest rate on Baa corporate bonds is , on average, than interest rates on
Treasuries, and the spread between these rates became in the 1970s.
U
A) lower; smaller
B) lower; larger
SE
C) higher; smaller
D) higher; larger
Answer: D
Question Status: Previous Edition
AACSB: Reflective Thinking
IS
12) Everything else held constant, a decline in interest rates will cause spending on housing to
O
A) fall.
B) remain unchanged.
N
C) either rise, fall, or remain the same.
D) rise.
N
Answer: D
Question Status: Previous Edition
O
AACSB: Analytical Thinking
C
13) High interest rates might purchasing a house or car but at the same time high
interest rates might saving.
ED
A) discourage; encourage
B) discourage; discourage
C) encourage; encourage
D) encourage; discourage
M
Answer: A
Question Status: Previous Edition
AACSB: Analytical Thinking
, 14) An increase in interest rates might saving because more can be earned in interest
income.
A) encourage
B) discourage
C) disallow
D) invalidate
Answer: A
Question Status: Previous Edition
AACSB: Analytical Thinking
15) Everything else held constant, an increase in interest rates on student loans
R
A) increases the cost of a college education.
B) reduces the cost of a college education.
U
C) has no effect on educational costs.
D) increases costs for students with no loans.
SE
Answer: A
Question Status: Previous Edition
AACSB: Analytical Thinking
16) High interest rates might cause a corporation to
provide more jobs.
A) complete
IS building a new plant that would
O
B) consider
C) postpone
N
D) contemplate
Answer: C
N
Question Status: Previous Edition
AACSB: Analytical Thinking
O
17) The stock market is
C
A) where interest rates are determined.
B) the most widely followed financial market in the United States.
ED
C) where foreign exchange rates are determined.
D) the market where most borrowers get their funds.
Answer: B
Question Status: Previous Edition
M
AACSB: Reflective Thinking
18) Stock prices are
A) relatively stable trending upward at a steady pace.
B) relatively stable trending downward at a moderate rate.
C) extremely volatile.
D) unstable trending downward at a moderate rate.
Answer: C
Question Status: Previous Edition
AACSB: Reflective Thinking
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