chapter 14

1) The government agency that oversees the banking system and is responsible for the conduct of monetary policy in the United States is

• 1) The government agency that oversees the banking system and is responsible for the conduct of monetary policy in the United States is

• B) the United States Treasury

• C) the U.S. Gold Commission

• D) the House of Representatives

2) Individuals that lend funds to a bank by opening a checking account are called

• A) policyholders

• B) partners.

• C) depositors.

• D) debt holders.

3) The three players in the money supply process include

• A) banks, depositors, and the U.S. Treasury.

• B) banks, depositors, and borrowers.

• C) banks, depositors, and the central bank.

• C) banks, depositors, and the central bank.

4) Of the three players in the money supply process, most observers agree that the most important player is

• A) the United States Treasury

• B) the Federal Reserve System

• C) the FDIC

• D) the Office of Thrift Supervision.

1) Both ________ and ________ are Federal Reserve assets.

• A) currency in circulation; reserves

• B) currency in circulation; government securitie

• C) government securities; discount loans

• D) government securities; reserves

2) The monetary liabilities of the Federal Reserve include

• A) government securities and discount loans

• B) currency in circulation and reserves.

• C) government securities and reserves

• D) currency in circulation and discount loans

3) Both ________ and ________ are monetary liabilities of the Fed.

• A) government securities; discount loans

• B) currency in circulation; reserves

• C) government securities; reserves

• D) currency in circulation; discount loans

4) The sum of the Fedʹs monetary liabilities and the U.S. Treasuryʹs monetary liabilities is called

• A) the money supply

• B) currency in circulation

• C) bank reservesB) currency in circulation

• D) the monetary base.

5) The monetary base consists of

• A) currency in circulation and Federal Reserve notes

• B) currency in circulation and the U.S. Treasuryʹs monetary liabilities

• C) currency in circulation and reserves.

• C) currency in circulation and reserves.

6) Total reserves minus bank deposits with the Fed equals

• A) vault cash.

• B) excess reserves

• C) required reserves

• D) currency in circulation.