1. In general, the more liquid an asset the ______.% V) o: `0 [: J6 @
A. less it is likely to yield) D7 E: W! P1 K( h h, s9 ^
B. greater its risk of default
( _" N( V9 x+ J% i% ~ C. lower its market price will be J3 ?! c/ o0 A
D. more it will add to bank profits
! C% G- w- g1 k3 {8 v) Y: M4 [ 2. The interest rate printed on the face of a bond is called the ______.
0 G$ w% J2 [$ a+ B/ a A. coupon rate
/ B% T/ M% |- M, O0 s B. prime rate
0 ?5 B. I% u7 n5 g7 B, G2 @ C. printed rate
. @2 z: G* I1 N2 P x4 R D. nominal rate
2 ]' ^" S+ F! O* U4 k 3. A rise in interest rates leads to ______.
8 i1 h9 V3 Z4 m3 B* ~5 | A. capital gains for bondholders
3 [, h) N+ I/ b/ E4 I B. capital losses for bondholders1 Q8 l5 o/ C% [* Q
C. income gains for bondholders
5 N( \) [4 e; k6 U0 M' z r# y D. income losses for bondholders2 S' T/ I; P' i! [3 |
4. If the reserve requirement ratio were equal to zero, then ______.1 s% d& d" o1 A5 r# Y
A. the deposit multiplier would be infinitely large7 S" t7 e* d: q7 p' B
B. required reserves would be equal to zero7 C8 f O, n, V/ S
C. the banking system would theoretically be able to create an infinitely large amount of demand deposits* ~( E: @; e: H0 k. }& c7 o5 D
D. all of the above |