". VdoTips: Economic Practice Test 3



Economic Practice Test 3

11. Which of the following IS a function of money?
A. medium of exchange
B. store of value
C. unit of accounting
D. all of the above

12. Which of the following is a component of M-1?
A. savings deposits
B. credit card
C. checkable deposits
D. gold

13. Which of the following is a NOT component of M-2?
A. small time deposits
B. money market mutual funds
C. stocks
D. checkable deposits

14. Which of the following is true about the Federal Reserve System (Fed)?
A. it is a system of 12 central banks
B. its Board of Governors is elected by a vote of the people
C. its main policy-making body is the FDIC
D. it accepts deposits from the public and makes loans to businesses e. all of the above

15. An IOU of the Federal Reserve Bank of San Francisco to Bank of America is called:
A. discounts
B. federal funds
C. reserves
D. collateral