BUSN 602 Midterm Exam Answers

BUSN 602 Midterm Exam Answers for $44 Only

BUSN 602 Midterm Exam Answers

Part 1 of 1 –100.0 Points 
Question 1 of 205.0 PointsJill Clinton puts $1,000 in a savings passbook that pays 4% compounded quarterly. How much will she have in her account after five years? A.$1,200.50B.$1,220.20C.$1,174.80D.$1,217.50 

Question 2 of 205.0 PointsAn increase in inflation should: A.increase the demand for loanable fundsB.decrease the interest rate on loansC.increase the interest rate on loansD.none of the above 

Question 3 of 205.0 PointsEconomists use a ___________________ framework to explain how the prices and quantities of goods and services are determined in a free-market economic system. A.opportunityB.marginal costC.supply-and-demandD.anti-monopolyE.none of the above 

Question 4 of 205.0 PointsThe future value of $100 received today and deposited at 6 percent for four years is A.$126.B.$ 79.C.$124.D.$116.

Question 5 of 205.0 PointsAll of the following are important components of a financial system except: A.government and private policy makersB.a monetary systemC.the international monetary fundD.financial institutions and markets 

Question 6 of 205.0 PointsIn general, the effective rate of interest on a discount loan A.is lower than that on standard loanB.is higher than that on a standard loanC.is identical to that on a standard loanD.none of the above 
Question 7 of 205.0 PointsBecause of the financial crisis that began in 2008, by the end of 2009: A.unemployment was in excess of 10 percentB.many homeowners owed more money on their mortgage loans than the their homes were worthC.home mortgage foreclosure rates and personal and business bankruptcies were increasingD.over 100 banks in the U.S. had already failed with over 500 more being considered financially weakE.all of the above are true 
Question 8 of 205.0 PointsWhich of the following statements about greenbacks is false? A.Greenbackswere money issued by the U.S. government to help finance the Civil War.B.Greenbackswere fiat money.C.Greenbackswere not redeemable for gold or silver.D.All of the above statements are correct. 
Question 9 of 205.0 Points____________ is anything generally accepted as a means of paying for goods and services and for paying off debts. It must be easily divisible, so that exchanges can take place in small or large quantities; relatively inexpensive to store and transfer; and reasonably stable in value over time. A.A financial assetB.A real assetC.moneyD.all of the aboveE.none of the above 

Question 10 of 205.0 PointsList the five major capital market securities described in the chapter 7.The five major capital market securities are mortgages, treasury bonds, municipal bonds, corporate bonds, and corporate stocks (Melicher, 2014). Ronald W. Melicher, E. A. (2014). Introduction to Finance: Custom Edition Select Chapters, Fifteenth Edition. Danvers: John Wiley & Sons.Feedback: The five major capital market securities:
• Mortgage: loan backed by real property in the form of buildings and houses.
• Treasury bond: long-term debt instrument issued by the U.S. federal government.
• Municipal bond: long-term debt instrument issued by a state or local government.
• Corporate bond: debt instrument issued by a corporation to raise long-term funds.
• Common stock: security that indicates ownership interest in a corporation.

Question 11 of 205.0 PointsWhich of the following is not an asset of depository institutions? A.cashB.unsecured loansC.time depositsD.U.S. government securities 

Question 12 of 205.0 PointsIdentify and describe the factors, in addition to supply and demand, that determine interest rates. 

Question 13 of 205.0 PointsYou need $8,000 four years from now for a down payment on your future house. How much money must you deposit today if your credit union pays 5% interest compounded annually? Pick the closest answer. A.$6,269.59B.$6,578.95C.$6,394.12D.$6,189.83 

Question 14 of 205.0 PointsWhen investors expect __________ inflation rates they will require __________ nominal interest rates so that a real rate of return will remain after the inflation. A.higher, higherB.higher, lowerC.lower, higherD.none of the above 

Question 15 of 205.0 PointsThe major factor that determines the volume of savings, corporate as well as individual, is the: A.volume of spendingB.level of national incomeC.amount of private pension plansD.amount of life insurance policies 

Question 16 of 205.0 PointsYour college has agreed to give you a $10,000 tuition loan. As part of the agreement, you must repay $12,600 at the end of the three-year period. What interest rate is the college charging? A.8%B.9%C.11%D.6% 

Question 17 of 205.0 PointsIdentify the objectives of the national economic policy. 

Question 18 of 205.0 PointsThe three functions of money are: A.medium of exchange, store of value, and measure of liquidityB.conduit for international trade, store of value, and standard of valueC.medium of exchange, store of value, and standard of valueD.inflation hedge, measure of liquidity, and medium of exchange 

Question 19 of 205.0 Points$1,000 invested today at 6% interest would be worth ________ one year from now A.$1,600B.$1,060C.$1,160D.$1,006E.none of the above 

Question 20 of 205.0 PointsIf the money supply and total demand increase faster than output, prices will: A.fallB.stay the sameC.riseD.reflect lower inflation

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