Unit 4 5 &6 Flashcards
Barter
The exchange of one good or service for another
Reserve
Deposits kept back not available to make loans from them
Prime Rate
The amount banks charge their best loan customers
Fiat Money
Money that has value because the government says it has value
Money
Anything of value that is accepted in return for goods or services
Interest Rate
The stated cost to borrow money
Store of Value means it can be saved or stored to use at a future date
T
Banks must keep 20% of deposits in reserves
F
During the era of free banking, state banks conducted all bank functions
T
If more people want loans, interest rates will decrease
F
A customer’s deposit of $1,000 = $900 Excess Reserves
T
The prime rate is the stated cost to borrow money
F
Money that is backed by gold is an example of representative money
T
Money is not durable
F
US citizens today can exchange paper currency for gold
F
Commodity money is rarely used today
T
How many measures does the Federal Reserve us to calculate the money supply?
4
Excess Reserves are used for
Deposits
Required Reserves are keep at the
Federal Reserve and Vaults
UNIT 5
break! u deserve it (KEEP GREEN)
Board of Govenors
Governing body of the Federal Reserve System`
Federal Reserve System
12 Regional Central Banks
Bank Panic
When there is a widespread worry that banks do not have enough money to cover customers’s demands for withdrawals
Bank Run
Depositors fear their money is not safe in the bank
The first US central bank was chartered in 1791
T
Congress chartered the second Bank of the United States in 1811
F
The Federal Reserve is divided into districts of equal size
F
The Board of Governors reports to the US president
F
The interest banks pay to borrow money from a Federal Reserve Bank is the discount rate
T
Federal Reserve Bank has 14 district banks
F
Presently, the United States has no central bank
T
The structure of the Fed is meant to safeguard against corruption
T
All members of the Board of Governors are members of the Federal Open Market Committee
T
The Federal Open Market Committee is not able to have any power to change anything
F
Who advocated and developed the first Bank of the United States?
Alexander Hamilton
The Board of Governors are appointed by the
Congress
The Federal Reserve System comprises how many regional central banks?
12
Which of the following is responsible for making monetary policy?
Federal reserve Banks
Which of the following is not a tool used to conduct monetary policy?
Prime Rate
If a Bank’s reserve requirement increase and they are required to keep more reserves, what happens to the interest rate they charge to customers for loans?
The interest will increase
When did the era of free banking occur?
1837-1863
What interest rate does the bank charge their best customers?
Prime Rate
When was the Federal Reserve System established?
1913
UNIT 6
Take a break you deserve it (keep at green)
Glass-Steagall Act
Established the FDIC
Truth in Lending Act
Requires every lender to provide borrower with information about cost of credit
Protects consumers from unfair and deceptive credit card practices
Credit Card Act
Equal Credit Opportunity Act
Makes it illegal for lenders to use factors such as gender and race when determining whether someone should get a loan
Fair Credit Reporting Act
Protects consumer credit information
Gramm-Leach-Bliley Act
Allowed banks to engage in almost any financial activity
The Truth in Lending Act allows consumers to be aware of the true cost of the loan
T
Finance charges are the total dollar amount of interest plus anyt fees paid on the loan
T
The APR includes all fees and costs
T
The Credit CARD Act can not protect consumers from all unfair credit card practices
F
Crop failures in the 1920s were one of the contributing factor of bank failures
T
During the Great Depression, there were lots of bank failures
F
An interest rate ceiling is the lowest rate a bank can pay on certain deposits
T
A loan can be rejected based on marital status
F
A bank run occurs when a small amount of depositors withdraw all of their money from the bank at the same time
F
The Consumer Credit Protection Act is also known as which of the following?
Truth In Lending Act
Which Act deals with regulation of banks
Which Act deals with regulation of banks
