This quiz works best with JavaScript enabled. Home > Finance > Money And Banking > Money And Banking – Quiz 25 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Money And Banking Quiz 25 (21 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which of the following is an advantage of partnership but not of sole proprietorship? A) Few regulations. B) Easy to open and close. C) Specialization of skills. D) Limited life. Show Answer Correct Answer: C) Specialization of skills. 2. An agreement made today to purchase or sell a commodity in the future for today's price A) Share. B) Portfolio. C) Futures. D) Stock Split. Show Answer Correct Answer: C) Futures. 3. I can lend you five pounds to help you ..... until you're had time to go to the bank. A) By. B) Out. C) Up. D) On. Show Answer Correct Answer: B) Out. 4. How do savings bonds differ from other forms of bonds? A) Provides interest payments. B) Higher return rate. C) Shorter time period. D) Lower price at time of purchase. Show Answer Correct Answer: D) Lower price at time of purchase. 5. The Federal Reserve System is often called A) The System. B) Supreme Fed System. C) The FED. D) All of the above. Show Answer Correct Answer: C) The FED. 6. The demand for money increases when national income increases because A) The public becomes more optimistic about the future. B) The budget deficit increases. C) The money supply increases. D) Spending on goods and services increases. Show Answer Correct Answer: D) Spending on goods and services increases. 7. Which of the characteristics of money can be defined as "able to be broken down into smaller parts" ? A) Uniformity. B) Portability. C) Divisibility. D) Durability. Show Answer Correct Answer: C) Divisibility. 8. Which of the characteristics of money can be defined as "Consistent or Identical" ? A) Uniformity. B) Durability. C) Portability. D) Divisibility. Show Answer Correct Answer: A) Uniformity. 9. What does the "I" in the interest formula stand for? A) Time. B) Principal. C) Rate. D) Interest. Show Answer Correct Answer: D) Interest. 10. How does new money enter into circulation in the United States? A) It is distributed by banks, which get it from the Fed. B) FDIC distributes new money when insurance claims are paid out to Fed stockholders. C) It is distributed to taxpayers each year in the form of tax refunds. D) Large businesses use the Fed to exchange their old money for new. Show Answer Correct Answer: A) It is distributed by banks, which get it from the Fed. 11. You want to spread out your investment money into different bussinesses. What do you invest in? A) A stock. B) Credit unions. C) Mutual fund. D) Finance company. Show Answer Correct Answer: C) Mutual fund. 12. A number, roughly between 300 and 800, that measures an individual's credit worthiness. A) Credit score. B) Credit history. C) Interest rate. D) Collateral. Show Answer Correct Answer: A) Credit score. 13. What characteristic of money helps it keep its value and deters inflation? A) Limited supply. B) Acceptability. C) Uniformity. D) Portability. Show Answer Correct Answer: A) Limited supply. 14. Exchange of one commodity or service for another A) Medium of Exchange. B) Barter. C) Money. D) Store of Value. Show Answer Correct Answer: B) Barter. 15. The function of money which refers to it as a way to conduct trade and its being accepted as a means of payment for goods and services is referred to as ..... A) Store of value. B) Medium of exchange. C) Unit of value. D) Measure of value. Show Answer Correct Answer: B) Medium of exchange. 16. The one rupee note and coins are issued by: A) Commercial Bank. B) RBI (Central Bank). C) Central government. D) Ministry of Finance. Show Answer Correct Answer: D) Ministry of Finance. 17. In economics terms, what does it mean if something has liquidity? A) The asset can be easily used or converted into cash. B) The asset can be a solid or a gas depending on the temperature. C) The asset takes a long time to be converted into cash. D) The asset can be easily traded for water. Show Answer Correct Answer: A) The asset can be easily used or converted into cash. 18. The Fed's key function is to A) Make sure the nation's banking system is sound and safe. B) Maintain an effective payment system for banks and government. C) Promote a healthy economy by using monetary policy. D) All of the above. Show Answer Correct Answer: D) All of the above. 19. Which of the following will happen when interest rates increase in an economy? A) The spending multiplier will decrease. B) The price of previously issued bonds will increase. C) The opportunity cost of holding money will increase. D) The cost of borrowing will decrease. E) Investment spending will increase. Show Answer Correct Answer: C) The opportunity cost of holding money will increase. 20. When the amount of money withdrawn from a bank account is greater than the amount available. A) Overdraft. B) Credit card. C) Interest. D) Loan fee. Show Answer Correct Answer: A) Overdraft. 21. The Board of Governors are ..... A) Voted upon by their membersq. B) Selected by Congress. C) Appointed by the President. D) None of above. Show Answer Correct Answer: C) Appointed by the President. ← PreviousRelated QuizzesFinance QuizzesMoney And Banking Quiz 1Money And Banking Quiz 2Money And Banking Quiz 3Money And Banking Quiz 4Money And Banking Quiz 5Money And Banking Quiz 6Money And Banking Quiz 7Money And Banking Quiz 8Money And Banking Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books