货币银行学B卷复习资料.docx

江西财经大学0910学年第二学期期末考试参考答案及评分标准试卷代码： 12423B 授课课时：48课程名称： 货币银行学 适用对象：国际学院学生试卷命题人 李静 试卷审核人 王耀德 Part I. This part has 20 Multiple Choice Questions and each one is worth 1 points. The total points for this part are 20 points. Please choose only one answer for each question.1 Models describing the determination of the money supply and the Feds role in this process normally focus on _ rather than _, since Fed actions have a more predictable effect on the former. (a) reserves; the monetary base (b) reserves; high-powered money (c) the monetary base; high-powered money (d) the monetary base; reserves Answer: DQuestion Status: Previous Edition2 A disadvantage of a forward contract is that a) it may be difficult to locate a counterparty. b) the forward market suffers from lack of liquidity. c) these contracts have default risk. d) all of the above. Answer: DQuestion Status: New3 The goals of bank asset management include a) maximizing risk. b) minimizing liquidity c) lending at high interest rates regardless of risk. d) purchasing securities with high returns and low risk. Answer: DQuestion Status: New4 If interest rates are expected to rise in the future, the demand for long-term bonds _ and the demand curve shifts to the _. a) rises; right b) rises; left c) falls; right d) falls; left Answer: DQuestion Status: Previous Edition5 The Feds most commonly used means of changing the money supply is a) changing reserve requirements. b) changing the discount rate. c) open market operations. d) changes in interest rate ceilings. Answer: CQuestion Status: Revised6 If the liquidity effect is smaller than the other effects, and the adjustment to expected inflation is immediate, then the a) interest rate will fall. b) interest rate will rise. c) interest rate will fall immediately below the initial level when the money supply grows. d) interest rate will rise immediately above the initial level when the money supply grows. Answer: DQuestion Status: Previous Edition7 A system of deposit insurance a) attracts risk-taking entrepreneurs into the banking industry. b) encourages bank managers to assume increased risk. c) increases the incentives of depositors to monitor the riskiness of their banks asset portfolio. d) does only (a) and (b) of the above. Answer: DQuestion Status: Study Guide8 The formula for the money multiplier that includes excess reserves and currency is a) m (1+c)÷ ( r e c). b) M 1÷ (r e c). c) M (1 c) ÷( r e c). d) D 1÷( r e c). Answer: AQuestion Status: New9 The four players in the money supply process include (a) banks, depositors, borrowers, and the U.S. Treasury. (b) banks, depositors, the central bank, and the U.S. Treasury. (c) banks, depositors, the central bank, and borrowers. (d) banks, borrowers, the central bank, and the U.S. Treasury. Answer: CQuestion Status: Previous Edition10 The goals of monetary policy include (a) output stability. (b) price stability. (c) stability of the financial markets. (d) both (b) and (c) of the aboveAnswer: DQuestion Status: New11 In the one-period valuation model, the current stock price increases if (a) the expected sales price increases. (b) the expected sales price falls. (c) the required return increases. (d) dividends are cut. Answer: AQuestion Status: New12 If the expected return on NBC stock rises from 5 to 10 percent and the expected return on CBS stock rises from 12 to 18 percent, then the expected return of holding CBS stock _ relative to NBC stock and the demand for CBS stock _. a) rises; rises b) rises; falls c) falls; rises d) falls; falls Answer: AQuestion Status: Previous Edition13 Which of the following statements is true? a) A banks assets are its uses of funds. b) A banks assets are its sources of funds. c) A banks liabilities are its uses of funds. d) Only (b) and (c) of the above are true. Answer: AQuestion Status: Previous Edition14 When economists say that money promotes efficiency, they mean that money a) increases transactions costs. b) encourages specialization and the division of labor. c) is inexpensive to produce. d) does both (b) and (c) of the above. Answer: BQuestion Status: Previous Edition15 When the default risk in corporate bonds increases, other things equal, the demand curve for corporate bonds shifts to the _ and the demand curve for Treasury bonds shifts to the _. a) right; right b) right; left c) left; left d) left; right Answer: DQuestion Status: Previous Edition16 Which of the following is not one of the eight basic puzzles about financial structure? a) Stocks are the most important source of finance for American businesses. b) Issuing marketable securities is not the primary way businesses finance their operations. c) Indirect finance, which involves the activities of financial intermediaries, is many times more important than direct finance, in which businesses raise funds directly from lenders in financial markets. d) Banks are the most important source of external funds to finance businesses. Answer: AQuestion Status: Previous Edition17 When people begin to expect a run up in large stock market, the demand curve for bonds shifts to the _ and the interest rate _. a) right; rises b) right; falls c) left; falls d) left; rises Answer: DQuestion Status: Previous Edition18 With an interest rate of 6 percent, the present value of $100 next year is approximately a) $106. b) $100. c) $94. d) $92. Answer: CQuestion Status: Previous Edition19 The Fed uses three policy tools to manipulate the money supply: _, which affect reserves and the monetary base; changes in _, which affect reserves and the monetary base by influencing the quantity of discount loans; and changes in _, which affect the money multiplier. a) open market operations; discount lending; margin requirements b) open market operations; discount lending; reserve requirements c) discount lending; open market operations; margin requirements d) discount lending; open market operations; reserve requirements Answer: BQuestion Status: Revised20 The bond markets are important because a) they are easily the most widely followed financial markets in the United States. b) they are the markets where foreign exchange rates are determined. c) they are the markets where interest rates are determined. d) of each of the above. Answer: CQuestion Status: Previous EditionPart . This part has 10 True of False Questions and each one is worth 1 points. The total points for this part are 10 points. 1 If reserve requirement were elimininated, it would be harder to control interest rates.Answer: False2 Higher stock prices means that consumers wealth is higher and so they will be more likely to decrease their spending.Answer: False3 The income effect of an increase in the money supply is a rise in interest rates in response to the higher level of income.Answer: True4 If bonds of different maturities are close substitutes, their interest rates are more likely to move together.Answer: True5 The goal for high employment should seek an unemployment level of zero.Answer: False6 The quantity demanded of an asset is negatively related to its liquidity relative to alternative assets.Answer: False7 Foreign exchange rates, like stock prices, should follow a random walk.Answer: True8 Given the return on assets, the higher the bank capital, the lower the return for the owners of the bank.Answer: False9 Issuing marketable debt and equity securities is the primary way in which businesses finance their operations.Answer: False10 The price of a coupon bond and the yield to maturity are negatively related.Answer: TruePart . This part has 4 Key Terms Questions and each one is worth points. The total points for this part are 10 points. Please explain briefly for each key term.1 Fisher effect P. 1002 Risk premiumThe spread between the interest rates on bonds with default risk and default-free bonds, called the risk premium, indicates how much additional interest people must earn in order to be willing to hold that risky bond. P. 1213 Defensive open market operations P. 3984 Nonborrowed monetory base P. 381Part . This part has 5 Essay Questions and each one is worth 12 points. The total points for this part are 60 points. ( Please write down your answers as clearly as possible. If I cant read your hand-writing, I never assume your answers are right )1 What factors determine a banks holdings of excess reserves? How does a change in each factor affect excess reserves, the money multiplier, and the money supply? Answer: An increase in market interest rates reduces excess reserves because banks profit from increase lending. An increase in expected deposit outflows increases excess reserves. An increase in interest rates reduces excess reserves, increasing the multiplier and the money supply. An increase in expected outflows increases excess reserves, reducing the multiplier and the money supply.2 Explain three ways by which the Federal Reserve System can increase the monetary base. Why is the effect of Federal Reserve actions on bank reserves less exact than the effect on the monetary base? Answer: The Fed can increase the monetary base by purchasing government bonds and foreign currency deposits, and by extending discount loans. If the person selling the security chooses to keep the proceeds in currency, bank reserves do not increase. Because the Fed cannot control the distribution of the monetary base between reserves and currency, it has less control over reserves than the base.3 Assume that a customer deposits $1000 in her bank. Show in a T-account the effect of this deposit. If the bank is subject to reserve requirements, show in a second T-account the banks balance sheet indicating required and excess reserve. In a third T-account, show the change in the banks balance sheet when the bank makes loans with the excess reserves. Answer: Reserves$1000Checkable deposits$1000Required reserves$100Checkable deposits$1000Excess reserves$900Required reserves$100Checkable deposits$1000Loans$9004 Demonstrate graphically the effect of an increase in the personal savings rate. Show and explain the effect of increased savings on bond prices and interest rates. How would this change affect capital spending? Answer: A graph of bond supply and demand should show an increase in bond demand. The increase in bond prices and the fall in the interest rates should be clearly shown and explained. The increase in saving lowers interest rates, thus increasing capital spending.5 Explain the concepts of asymmetric information, adverse selection, and moral hazard. When do adverse selection and moral hazard become relevant to the lending process? How has the financial system developed to deal with these problems? Answer: Asymmetric information is uneven information, which creates the problems of adverse selection and moral hazard. Adverse selection is having a disproportionate number of high-risk loan applications. Moral hazard is the risk that the borrower will engage in risky behavior after the loan is made. Adverse selection is a problem before a loan is made, and moral hazard is a problem that exists after a loan is made. Financial intermediaries develop the expertise to screen and monitor loans, overcoming these problems. Regulations require timely provision of information.