ECON 110 Read & Interact Schiller & Gephardt Chapter 13 solutions complete answers

ECON 110 Read & Interact Schiller & Gephardt Chapter 13 solutions complete answers 

 

Government   is an example of a constraint on deposit creation that is related to the idea that the Fed may limit deposit creation by imposing reserve requirements.

 

Bitcoins are not considered money because they are not

 

The constraint on deposit creation that is related to the willingness of consumers and businesses to continue accepting checks or debit cards rather than cash in the marketplace is bank  .

 

The primary economic function of banks is to ________ from savers to spenders.

 

When the money supply shrinks, the result is

 

1/(required reserve ratio) is the formula for the

 

Reserve requirements are less than 100%, which means they are

 

When you deposit money in a bank, the bank will:

 

Near   (enter one word) refers to certain highly liquid financial assets that do not function directly or fully as a medium of exchange but can be readily converted into currency or checkable deposits.

 

Money supply M1 includes ______ in the hands of the public and all transactions account balances.

 

A bank account that permits _______ is called a transaction account.

 

Currency held by the public plus balances in transactions accounts is typically referred to as

 

In the United States, society uses what to measure the relative worth of goods and services?

 

The direct exchange of one good for another, without the use of money, is called a   (one word) system.

 

The direct exchange of one good for another, without the use of money is 

 

Because money is a medium of exchange, society avoids

 

Money is accepted as payment for goods and services and is therefore considered what?

 

The fact that money can be available to use at a future date explains which function of money?

 

In the US, society uses what to measure the relative worth of goods and services?

 

The direct exchange of one good for another, without the use of money is called       (one word) system.

 

Which of the following is a function of money?

 

As a medium of exchange, money allows society to escape the complications of

 

As long as something serves as a medium of exchange, a store of value, and a standard of value, it can be considered 

 

When money is accepted as payment for goods and services, it functions as a:

 

A bakery worker receives money for labor rather than 200 bagels. This is an example of money as a medium of      .

 

Money serves as a store of       that enables people to hold it for future purchases.

 

True or false: The concept of money includes more than just cash.

 

When money is used as a yardstick for measuring the relative worth of goods or services, it is functioning as a

 

Money functions primarily as a medium of      , a standard of      , and a store of value.

 

Very broadly, anything generally accepted as a medium of exchange is

 

A bank account that permits direct payment to a third party (e.g., with a check) is called a

 

Which of the following is an example of money serving as a medium of exchange?

 

The concept of money includes more than just

 

The balance in your transactions account _______, and is therefore a form of money.

 

When money measures the prices of goods and services it is functioning as a:

 

Currency held by the public plus balances in transactions accounts plus traveler’s checks is typically referred to as

 

Very broadly, money is

 

The components of money supply (M1) include

 

A bank account that permits _______ is called a transaction account

 

True or false: Mobile payments are not money.

 

Near       (Enter one word) are certain highly liquid financial assets that do not function directly or fully as a medium of exchange but can be readily converted into currency or checkable deposits.

 

The balance in your transactions account substitutes for cash, and is therefore a form of

 

M1 is a way of measuring the basic       supply.

 

True or false: Additional measures of the money supply (M2, M3, etc.) include the components of M1 plus some near money.

 

Money supply (M1) equals       plus transactions deposits plus travelers checks. (Remember, enter only one word for the blank.)

 

The total quantity of output demanded at alternative price levels in a given time period, ceteris paribus, is

 

Which of the following is not considered to be money?

 

Which of the following characterize near money?

 

How much _______ people have directly affects their spending behavior and therefore aggregate demand.

 

Most money is not cash, but instead

 

Additional measures of the money supply (M2, M3, etc.) include the components of M1 plus

 

Bank balances come from _______.

 

The _______ at alternative price levels in a given time period, ceteris paribus, is aggregate demand.

 

True or false: Banks create money by lending.

 

True or false: Credit cards and mobile payment services are money.

 

The creation of transactions deposits by bank lending is known as

 

How much money people have directly affects their spending behavior and therefore

 

If an individual deposits into a checking account $500 that he/she had been saving under a mattress, how does the size of the money supply (M1) change?

 

Most money is not _____ but instead bank balances.

 

A withdrawal of cash will       (increase/decrease) the bank’s transactions deposit but not change the total supply of money.

 

True or false: Bank balances come from cash deposits and direct deposits.

 

Who can create money through lending?

 

A bank will use your deposit as the basis for making a(n)       to somebody else.

 

Deposit creation is

 

Assets held by a bank to fulfill its deposit obligations are bank      .

 

If an individual deposits into a checking account $100 that he/she had been saving in a piggy bank, how does the size of the money supply (M1) change?

 

Reserve requirements are ______, meaning they are less than 100%.

 

A withdrawal of cash will

 

The ratio of a bank’s reserves to its total transactions deposits is the       (one word) ratio.

 

When you deposit money in a bank the bank will:

 

Dividing a bank's reserves by its total deposits produces the

 

Assets held by a bank to fulfill its deposit obligations are known as

 

What is a significant characteristic of fractional reserve banking?

 

By definition, within a fractional reserve banking system, ______ are only a fraction of the total transaction deposits.

 

Which of the following agencies has the authority to establish and vary the reserve ratio?

 

The minimum amount of deposits that a bank is required by law to hold and not lend out is called its

 

The required reserve ratio multiplied by deposits is the bank's

 

The reserve ratio is calculated as

 

If the required reserve is 10% and a bank accepts $50,000 in demand deposits from the public, then it would have to keep _____ as reserves.

 

The Federal Reserve System has the authority to establish and vary:

 

The minimum amount of deposits that a bank is required by law to hold and not lend out is called its required       (Enter one word).

 

If a bank has total reserves of $50,000, transactions deposits of $100,000, and a reserve ratio of 10%, its excess reserves are

 

Required reserves are calculated as

 

Excess reserves equal      reserves minus       reserves.

 

On a T-account, the total assets must ______ the total liabilities.

 

If the required reserve is 10% and a bank accepts $10,000 in demand deposits from the public, then it would have to keep ______ in reserves.

 

What is the formula for the money multiplier?

 

If a bank has total reserves of $100,000, transactions deposits of $100,000, and a reserve ratio of 50%, its excess reserves are

 

Which of the following statements best explains how the movement of reserves and deposits leads to the existence of the money multiplier?

 

Excess reserves is calculated as

 

A smaller required reserve ratio means a ______ monetary multiplier and ______ potential deposit creation through loans.

 

On a T-account, the value of the assets must be ______ the amount of the liabilities.

 

The formula for potential deposit creation is ______ multiplied by the monetary multiplier.

 

The money multiplier is equal to

 

At a maximum a bank may lend

 

The ______ magnifies excess reserves into the larger creation of checkable deposit money.

 

The banking system can increase the volume of _______ by the total amount of excess reserves multiplied by the money multiplier.

 

A smaller _____ means a higher money multiplier and greater potential deposit creation through loans.

 

_______ create money through lending.

 

When there is a reduction in lending, the money supply _______ and aggregate demand _______.

 

Excess reserves times the money multiplier is equal to

 

Banks perform two essential functions for the macro economy:

 

If a bank has $1 million in excess reserves, how much can this bank loan out?

 

One of the main functions of banks is to transfer purchasing power from _____ to _____.

 

The banking system can increase the volume of loans by the total amount of excess reserves multiplied by the _______

 

Increases in the money supply tend to lead to

 

The four major constraints on money creation are

 

When lending takes place, the money supply _______ and aggregate demand _______.

 

The constraint on deposit creation that is related to the willingness of consumers and businesses to continue accepting checks or debit cards rather than cash in the marketplace is called bank      .

 

Which of the following is NOT an essential function for banks in the macro economy?

 

The constraint on deposit creation related to the willingness of consumers, businesses, and governments to borrow the money that banks make available is related to the willingness to      .

 

The primary economic function of banks is to ________ from savers to spenders

 

The constraint on deposit creation related to the idea that once banks are holding sufficient reserves, they must be willing to make new loans is the willingness to      .

 

When the money supply shrinks this results in

 

The constraint on deposit creation related to the idea that the Fed may limit deposit creation by imposing reserve requirements is related to:

 

Which of the following are the four major constraints of money creation?

 

Are bitcoins money?

 

The constraint on deposit creation related to the willingness of consumers and businesses to continue accepting checks or debit cards rather than cash in the marketplace is:

 

The constraint on deposit creation related to the willingness of consumers, businesses, and governments to borrow the money that banks make available is related to:

 

The constraint on deposit creation related to the idea that if banks are holding sufficient reserves they must also be willing to make new loans is related to:

 

An example of a constraint on deposit creation that is related to the idea that the Fed may limit deposit creation by imposing reserve requirements is called government       (one word).

 

Bitcoins are not considered money because it is not

 

The narrowest definition of the money supply is

 

True or false: Banks create money by purchasing U.S. government bonds and other assets such as stocks.

 

Money supply M1 includes ______ in the hands of the public, all transactions account balances and travelers checks.

 

The lending process is what allows banks to:

 

Bank reserves are

 

If the required reserve is 20% and a bank accepts $50,000 in demand deposits from the public, then it would have to keep ______ as reserves.

 

If the required reserve is 20% and a bank accepts $10,000 in demand deposits from the public, then it would have to keep ______ in reserves.

 

A single bank can lend only an amount equal to its _____ reserves.

 

If a bank has total reserves of $110,000, transactions deposits of $100,000, and a reserve ratio of 20%, its excess reserves are

 

Which of the following represent functions of money?

 

The number of deposit (loan) dollars that the banking system can create from $1 of excess reserves is known as the _______ multiplier

 

Money is a medium of _______ that is accepted as payment for good and services

 

Which of the following is considered to be money?

 

As long as a bank has _______ reserves, it can make additional loans

 

1/(required reserve ratio) is known as

 

Bank balance come from _______

 

Additional measures of money supply (M2, M3, etc.) include the components of M1 plus

 

Which of the following statement best explains how the movement of reserves and deposits lead to the existence of the money multiplier?

 

If $500 is deposited into the banking system, it will increase the supply of money by _______ if the reserve ratio is 10%

 

Money serves as a store of value that enables people to:

 

Money is usable for buying and selling goods and is therefore considered what?

 

The formula for the maximum demand deposit creation can be illustrated using the following equation: potential deposit creation = excess reserves x _______

 

The maximum amount of money that a single bank can lend is equal to

 

The equation for the money multiplier is 1 divided by the required _____________ ratio.

 

A higher reserve ratio means a ______ monetary multiplier and ______ creation of checkable deposit money through loans.