Macro 04 18 16

Question 1

In general, bonds issued by firms that credit agencies consider 2b _____ have high coupon r8s

Accepted Answer

risky

Question 2

The amount initially lent when a bond is issued is called the _________

Accepted Answer

principal amount

Question 3

An increase in interest rates will tend to lower:

Accepted Answer

both stick prices and bond prices

Question 4

In a fractional reserve banking system, if the public withdraws cash fr banks, -> money supply

Accepted Answer

will decrease

Question 5

If the principal amount of a bond is $10,000, then the market value of the bond:

Accepted Answer

may be >, <, or = to $10,000

Question 6

The returns that stockholders receive on their stock holdings include _________

Accepted Answer

capital gains (when stock price increases), dividends

Question 7

In general, the money supply equals

Accepted Answer

currency held by the public + bank deposits

Question 8

If banks' reserves equal $25,000 and deposits equal $100,000, then the reserve-deposit ratio =

Accepted Answer

25 percent

Question 9

If the principal on a 20 year bond is $10,000, the coupon rate is 5%,annual coupon pymt is?

Accepted Answer

500

Question 10

The function money performs when it is used to measure the worth of various items

Accepted Answer

unit of account

Question 11

Municipal bonds (exempt fr fed taxes) tend 2 have __ coupon rates than otherwise similar bonds.

Accepted Answer

lower

Question 12

The Fed can decrease the supply of money through _______

Accepted Answer

open-market sales

Question 13

An open-market purchase is the _____

Accepted Answer

purchase of gov't bonds by the Fed from the public

Question 14

If bank reserves equal $50,000 and the desired reserve-deposit ratio is 5%, -> bank deposits =?

Accepted Answer

$1,000,000

Questions 14