module 13

Question 1

The ____ for money is a function of economic forces

Answer 1

Demand

Question 2

The ____ of money is largely a function of the federal reserve as it regulates the money supply.

Answer 2

Supply

Federal reserve regulates the supply of money

Question 3

Capital market involves

Answer 3

long-term and intermediate-term money instruments

Question 4

The capital market is divided into two types of capital

Answer 4

debt and equity

Question 5

Capital instruments may include

Answer 5

Stocks
Bonds
Mortgages
REITs
Deeds of trust/land contracts

Question 6

Short-term money instruments that comprise the money market can include

Answer 6

Notes
Funds
Eurodollars
CDs

Treasury notes
Commercial notes
Municipal notes
CD's
Federal funds
Eurodollars

Question 7

The interaction of buyers and sellers who trade short-term money instruments is referred to as a

Answer 7

money market

Question 8

Bonds, stocks, and mortgages are _______ instruments

Answer 8

capital

Question 9

The ______ implements the fiscal policy of the United States.

Answer 9

(TI). Treasury implements

U.S. Treasury

Question 10

The ______carries out the nation’s monetary policy

Answer 10

RC (reserve Carries)out

Federal reserve

Question 11

_______ are compensated by dividends (cash flow) and the potential appreciation in the value of their investment.

Answer 11

Equity investors

Question 12

______ participate in bonds and mortgages and receive fixed or variable interest on their investment through repayment of the principal upon maturity.

Answer 12

Debt investors

Question 13

Types of mortgages

Answer 13

Guaranteed Mortgage
Inured mortgage
Conventional mortgage
Energy-efficient mortgage (EEM( - may be conventional, FHA, or VA
Balloon mortgage

Question 14

The federal reserve is comprised of ____ regional banks and a number of member banks.

Answer 14

12

Question 15

What does the federal reserve regulate?

Answer 15

Reserve requirements
(if the fed wants to restrict the money supply, it increases the percent of reserves that member banks must maintain, and vice verca.

b. Federal discount rate
(the rate charged by the Fed for funds borrowed by member banks.

c. Federal open Market Committee
(members responsible for setting interest rates and credit policies of the federal reserve system.

Question 16

An erosion of the purchasing power of currency characterized by price escalation and an increase in the volume of money

Answer 16

inflation

Question 17

_____ is an increase in the price or value of a property or commodity resulting from an excess of demand over supply

Answer 17

appreciation

Question 18

_____ is a stated or contract rate.

Answer 18

nominal interest rate

Question 19

A _____ rate is a nominal interest rate that has been adjusted for expected inflation.

Answer 19

real interest

Question 20

What are the two sources of capital for real estate?

Answer 20

Money market

Capital Market

(debt & equity investors)

Question 21

The equity investor is usually more aggressive and willing to take risks, so the funds used for equity investments are called

Answer 21

venture capital

Question 22

The interaction of buyers and sellers who trade short-term money instruments is referred to as a

Answer 22

money market

Question 23

Bonds, stocks, and mortgages are ____ instruments

Answer 23

capital

Question 24

An FHA loan is an example of ______mortgage

Answer 24

insured

Question 25

The _____ implements the fiscal policy of the U.S.

Answer 25

U.S. Treasury

Question 26

The ______ carries out the nation’s monetary policy

Answer 26

Federal Reserve

Question 27

Treasury bills are considered to be short-term money instruments

Answer 27

True