Monetary Economics (ECS3701) Selected Examination Questions and suggested solutions 2023

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Assets are things that are useful or things that have value. T or F. - -True -One of the most important prices determined in financial markets is the __________________ rate. - -interest -When a... coffee shop lists a tall coffee on its menu at $2.95, the coffee shop is using money as a - -unit of account -Mandy goes to the grocery store to buy groceries, and at the checkout counter she pays cash. this is an example of money being used as - -medium of exchange -money that has no intrinsic value is known as - -fiat money -Bonds are issued by - -many kinds of borrowers -the face value of a bond is the - -original amount of money borrowed by the bond issuer -A bonds maturity refers to the - -period of time when the issuer of the bond makes repayment of the bonds principal -bond prices and interest rates are - -inversely related -the market for bonds is a subset of the market for loanable funds. T or F - -T -the Risk that a bond issuer will not be able to live up to the promise they make when they issue a bond is known as ... - -default risk -the rate at which a lender needs to be compensated for taking on greater risk is known as .... - -default risk premium -a major disadvantage that municipal bonds have over corporate bonds for investors is that - -the income earned on municipal bonds is not subject to federal income tax -an inverted yield curve likely means the - -economy is headed for recession. -an inverted yield occurs when - -long-term inte [Show More]

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