This quiz works best with JavaScript enabled. Home > Money And Banking > Money And Banking – Quiz 7 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Money And Banking Quiz 7 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which of the following is not the main forms of money? A) Cash. B) Bank deposits. C) Central bank reserves. D) Gift certificate. Show Answer Correct Answer: D) Gift certificate. 2. Travelers checks, often used for vacations: A) Travelers checks, often used for vacations:. B) Are free at most banks. C) Function as cash and are easily replaced if lost. D) Are FDIC insured. Show Answer Correct Answer: C) Function as cash and are easily replaced if lost. 3. What is the currency of the US called? A) Coins. B) Representative money. C) Fiat money. D) Gold. Show Answer Correct Answer: C) Fiat money. 4. What function does a central bank fulfil? A) It prints and issues currency. B) It offers overdraft facilities to individuals. C) It operates deposit accounts. D) It raises taxation. Show Answer Correct Answer: A) It prints and issues currency. 5. What is the purpose of the Federal Deposit Insurance Corporation (FDIC)? A) To make sure that banks do not fail. B) To make sure that customers do not lose money if a bank fails. C) To make sure that banks charge a fair amount of interest on loans. D) To make sure that the government has enough gold to cover its expenses. Show Answer Correct Answer: B) To make sure that customers do not lose money if a bank fails. 6. M1 and M2 makeup all of this in the U.S. economy. A) Fiat money. B) Representative money. C) Currency. D) Money supply. Show Answer Correct Answer: D) Money supply. 7. Which of the following option is the function of the central bank as a banker to commercial banks? A) Managing the national debt. B) Control foreign exchange. C) Policy maker for monetary policy. D) Lender of the last resort. Show Answer Correct Answer: D) Lender of the last resort. 8. Barter system is now replaced by A) Banking system. B) International system. C) Monetary system. D) Financial system. Show Answer Correct Answer: C) Monetary system. 9. The interest rate the bond issure pays to the bondholder is called the A) Coupon rate. B) Maturity rate. C) Discount rate. D) Value rate. Show Answer Correct Answer: A) Coupon rate. 10. Electronic transfer of money in terms of credit/debit entries of the account holders in the banks is called A) E-marketing. B) E-business. C) E-money. D) E-banking. Show Answer Correct Answer: C) E-money. 11. Our company made a record ..... last year. A) Profit. B) Earn. C) Benefit. D) Winning. Show Answer Correct Answer: A) Profit. 12. Medium of Exchange A) Used to exchange for goods and services needed. B) Means, money is a common measure of the worth or price of a good. C) Means it can be saved or stored for later, without the value decreasing. D) Money placed into an account. Show Answer Correct Answer: A) Used to exchange for goods and services needed. 13. The simple interest formula is I=Prt. The P represents the principal. What is PRINCIPAL in an economic sense? A) The amount of money borrowed or deposited. B) The percent interest for his year. C) The head administrator of a school. D) The amount the bank owes you for being a customer at their bank. Show Answer Correct Answer: A) The amount of money borrowed or deposited. 14. The amount one must pay to borrow money from someone else A) Interest. B) Portfolio. C) Diversification. D) Principal. Show Answer Correct Answer: A) Interest. 15. Why is representative money more useful than commodity money? A) Representative money can be used for other things besides currency. B) Representative money has value because the government says it does. C) Representative money exists in unlimited supply, so more people use it. D) Representative money is portable, durable, divisible, and acceptable. Show Answer Correct Answer: D) Representative money is portable, durable, divisible, and acceptable. 16. Your portfolio is diversified. You have ..... investments. A) Preferred and common. B) Financially based. C) Many different. D) Completely successful. Show Answer Correct Answer: C) Many different. 17. During times of hyperinflation A) People often adopt something other than the official currency to use as money. B) People hoard the official currency. C) The purchasing power of the currency increases rapidly. D) The money supply is decreasing. Show Answer Correct Answer: A) People often adopt something other than the official currency to use as money. 18. How useful cacao beans might be as money today./ unclear what the beans are worth or how to measure them against other items A) Medium of exchange. B) Standard of value. C) Store of value. D) None of above. Show Answer Correct Answer: B) Standard of value. 19. Anything that is used to determine value during the exchange of goods and services. A) Store of Value. B) Unit of Account. C) Medium of Exchange. D) Barter System. Show Answer Correct Answer: C) Medium of Exchange. 20. Money which is accepted as a medium of exchange because of trust between the payer and the payee is called- A) Full bodied money. B) Fait money. C) Fiduciary money. D) None of these. Show Answer Correct Answer: C) Fiduciary money. ← PreviousNext →Related 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 8Money And Banking Quiz 9Money And Banking Quiz 10Money And Banking Quiz 11 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books