ECON - Unit 5 Practice Test

If someone robbed the bank and took all the money, your money in that bank would still be safe. Why?

• rich bankers would pay you back
• banks are insured by the FDIC

• you would hunt down the robbers
• Scooby Doo would find the robbers

How many District Banks are in the Federal Reserve System?

• 5

• 7

• 12

• 50

Federal Reserve Board of Governors members are appointed by the ____________ and confirmed by the ____________.

• state governors, Supreme Court

• House of Representatives, Senate

• Senate, President

• President, Senate

Only making the minimum payment on a credit card every month will:

• lower the amount total paid for the purchase
• make you independently wealthy
• take longer to pay off which will result in paying more interest, more money!
• pay off the credit card faster

If you were short of cash and needed a short term loan, which of the following would be your worst choice of a source for a loan.

• local bank

• credit union

• pay day lender

• credit card cash advance

How can a cardholder avoid paying interest on a credit card?

• Do not pay anything
• Pay the minimum payment after its due date
• Pay the minimum balance every month
•  Pay the balance in full every month

What is the main difference between a bank and a credit union?

• banks don't do car loans
• credit unions don't have debit
• credit unions don't have loans
• banks are for profit, credit unions aren't

When money is used to compare the value of a two different goods, it serves as a:

• medium of exchange

• store of value

• measure of purchase

• standard of value

What is the primary function of the Federal Reserve?

• To regulate the stock market

• To control the nation's money supply and stabilize the economy

• To manage the national debt

• To oversee the banking industry

The goals of monetary policy do NOT include the promotion of _________________.

• Maximum employment

• Stable prices

• Moderate long-term interest rates

• Low taxes