Question 1
1. The holding-company device to control two or more commercial banks:
Answer
has diminished in importance in recent years
has increased in importance in recent years
is limited to state chartered banks
is sometimes described as chain banking
Question 2
The Federal Deposit Insurance Corporation Improvement Act of 1991:
Answer
transferred the reserves and functions of the Federal Savings and Loan Insurance Corporation to the FDIC
required that failed banks be handled in such a way as to provide the lowest cost to the FDIC
increased federal deposit insurance from $40,000 to $100,000 for each account
extended federal deposit insurance to S&L depositors
Question 3
The Monetary Control Act:
Answer
extended the Fed's control to thrift institutions and non-member commercial banks
has resulted in more competition among depository institutions
increased federal deposit insurance from $40,000 to $80,000 for each account
established minimum capital requirements for banks with federal charters
Question 4
The item on the assets side of a bank's balance sheet that represents the largest proportion of bank assets is:
Answer
Deposits
owner's capital
securities
loans
Question 5
The item on the liabilities and equity section of a bank's balance sheet that represents the largest proportion of a typical
bank's assets is:
Answer
deposits
owner's capital
securities
federal funds
Question 6
The item on the liabilities and equity section of a bank's balance sheet that represents the smallest proportion of bank's
assets is:
Answer
deposits
owner's capital
securities
federal funds
Question 7
An organization that sells or markets new securities issued by businesses to individuals and institutional investors is called a
(n)
Answer
mutual fund
investment bank
insurance company
brokerage firm
Question 8
The primary purpose of this Act was to aid the savings and loan industry
Answer
Garn-St. Germain Depository Institutions Act
Glass-Steagall Act
Hunt Commission legislation
Depository Institutions Deregulation and Monetary Control Act
Question 9
An organization that sells shares in their firms to individuals and others and invests the proceeds in corporate and government
securities is called a (n)
Answer
investment company
investment bank
insurance company
brokerage firm
Question 10
An organization that received contributions from employees and/or their employers and invests the proceeds on behalf of the
employees for use during their retirement years is called a (n)
Answer
mutual fund
savings bank
pension fund
retirement fund
Question 11
The __________________, passed in 1968, requires the clear explanation of consumer credit costs and garnishment procedures
(taking wages or property by legal means) and prohibits overly high-priced credit transactions.
Answer
Consumer Credit Expansion Act
Credit Growth Act
Consumer Credit Protection Act
Consumer Safety Act
Question 12
The Board of Governors:
Answer
is elected by the member banks
is appointed by the Senate
has seven members appointed for 14-year terms
has seven members appointed for a term of 12 years
Question 13
The banking system of the United States is a ___________ reserve system because banks are required by the Fed to hold
reserves equal to a specified percentage of their deposits.
Answer
Required
Fractional
proportional
multiplicative
Question 14
The dynamic actions of the Federal Reserve System:
Answer
contribute to the smooth everyday functioning of the economy
are designed to meet the credit needs of individuals and institutions
support depositories and other institutions
stimulate or repress the level of prices or economic activity
Question 15
The Federal Reserve Banks are owned by:
Answer
commercial banks
the U.S. Treasury
national member banks of the Federal Reserve System
member banks of the Federal Reserve System
Question 16
The Board of Governors publishes ________________, which carries articles of current interest and offers a convenient source of the statistics compiled by the Fed.
Answer
the Federal Reserve Magazine
the Federal Reserve Bulletin
the Federal Reserve Journal
the Federal Reserve News
Question 17
The Fed shares its depository examining functions with:
Answer
the Federal Savings and Loan Insurance Corporation
the FDIC, Comptroller of the Currency, and state agencies
only the Comptroller of the Currency
National Credit Union administration and the FDIC
Question 18
____________________________ requires disclosure of the finance charge and the annual percentage rate of credit along with certain other costs and terms to permit consumers to compare the prices of credit from differing sources.
Answer
Truth in Lending Act
Equal Credit Opportunity Act
Federal Trade Commission Improvement Act
Fair Credit Billing Act
Question 19
The percentage of deposits that must be held as reserves is called
Answer
the bank reserve percentage
the required reserve ratio
the excess reserve ratio
the fractional reserve percentage
Question 20
The purpose of Regulation Z is to:
Answer
make consumers aware of the costs of alternative forms of credit
prohibit garnishment
encourage depository institutions to help meet the credit needs of their communities for housing and other purposes
regulate the overseas activities of member banks of the Federal Reserve System