A) The difference between the price at which a commercial bank sells an asset to the central bank and the price it agrees to buy it back can be expressed as an annualized percentage of the selling price, and this is called the refinancing rate.
B) Commercial banks may borrow from and lend to each other, and the interest rate at which they do this is called the refinancing rate.
C) In SA the refinancing rate is known as the repo rate, and in the USA it is referred to as the discount rate.
D) If the central bank has bought some assets from a commercial bank with an agreement that the commercial bank will buy them back at a later date, then this would be called a repo.
F) B) and C)
Correct Answer
verified
Correct Answer
verified
A) A parent gives a teenager a R100 note in exchange for her babysitting services.
B) A homeowner gives an exterminator a cheque for R500 in exchange for extermination services.
C) A barber gives a plumber a haircut in exchange for the plumber fixing the barber's leaky tap.
D) All of the above are examples of barter.
F) B) and D)
Correct Answer
verified
Correct Answer
verified
A) Currency.
B) Accounts.
C) Bonds.
D) Stock.
F) B) and C)
Correct Answer
verified
Correct Answer
verified
A) Increasing the refinancing rate.
B) All of these will increase the money supply.
C) Buying government bonds in open market operations.
D) Increasing reserve requirements.
F) A) and D)
Correct Answer
verified
Correct Answer
verified
Correct Answer
verified
Most central banks have two main functio...View Answer
Correct Answer
verified
View Answer
A) the long term interest rate in the economy will rise, and the central bank will raise its interest rate in response.
B) the economy's banking system will lend more money to households and firms.
C) the short term interest rate at which the economy's commercial banks lend to and borrow from each other will fall, and the central bank may be expected to reduce the supply of liquidity to the banks.
D) the short term interest rate at which the economy's commercial banks lend to and borrow from each other will rise, and the central bank may be expected to increase the supply of liquidity to the banks.
F) A) and C)
Correct Answer
verified
Correct Answer
verified
A) asset
B) debit
C) loan
D) bond.
F) B) and C)
Correct Answer
verified
Correct Answer
verified
B) False
Correct Answer
verified
Correct Answer
verified
B) False
Correct Answer
verified
Correct Answer
verified
Correct Answer
verified
The central bank of an economy will set ...View Answer
Correct Answer
verified
View Answer
B) False
Correct Answer
verified
Correct Answer
verified
Correct Answer
verified
Banks create money by lending, but a num...View Answer
Correct Answer
verified
View Answer
B) False
Correct Answer
verified
Correct Answer
verified
Correct Answer
verified
Money is defined as the set of...View Answer
Correct Answer
verified
View Answer
Correct Answer
verified
The primary objective of the SARB is to ...View Answer
Correct Answer
verified
View Answer
B) False
Correct Answer
verified
Correct Answer
verified
A) gold standard.
B) silver standard.
C) credit account.
D) bank account.
F) A) and C)
Correct Answer
verified
Correct Answer
verified
A) must guarantee the convertibility of its currency into gold.
B) give its central bank independence.
C) cannot make use of a banking system.
D) must have a mechanism for regulating the quantity of money in the economy.
F) All of the above
Correct Answer
verified
Correct Answer
verified
Showing 41 - 58 of 58
Related Exams