Who Wants to be a Millionaire!? Monetary Policy Fastest Finger Question #1:

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Presentation transcript:

Who Wants to be a Millionaire!? Monetary Policy

Fastest Finger Question #1:

List the following groups in order based on salary: (starting with the least) A. Teacher A. Teacher B. Airline pilot B. Airline pilot C. Carpenter C. Carpenter

…And the Winner Is… C. Carpenter C. Carpenter A. Teacher A. Teacher B. Pilot B. Pilot

Road to Riches… 1 Ex 1 Ex 2 Extr 2 Extr 3 Extra 3 Extra 4 Extra Cre 4 Extra Cre 5 Extra Credit 5 Extra Credit ASK A FRIEND! 50/50

Money that has an alternative use: (1 Point) A. Fiat money C. Convertible money B. Commodity money D. Monopoly money

Something accepted by all parties as payment for goods and services (2 Points) A. Currency C. Fiat Money B. Medium of exchange D. Gold

The interest rate the Fed. Charges its member banks? (4 Points) A. Prime rate C. Excessive rate B. Discount rate D. Reserve rate

Rule stating that a percentage of every deposit be set aside as legal reserves: (6 Points) A. Discount rate C. Reserve requirement B. Gold standard D. Excess reserves

Excessive increases in the monetary supply lead to: (8 Points!) A. Deflation C. Inflation B. Low interest rates D. High interest rates

List the following commodities by price – lowest to highest: A. Silver A. Silver B. Platinum B. Platinum C. Gold C. Gold

…And the Winner Is… A. Silver A. Silver C. Gold C. Gold B. Platinum B. Platinum

The Fed. Must constantly choose between two evils. They are: (1 Point) A. Consumers C. Inflation B. Banks D. Recession

The Fed. does all of the following services EXCEPT: (2 Points) A. Oversees the activities of the Treasury Dept. C. Enforces consumer legislation B. Maintains currency / coins D. Clears checks

Which scenario indicates ‘easy/loose money policy’: (4 Points) A. Selling gov. securities C. Raising the discount rate B. Decreasing the reserve requirement D. Raising the price of milk

How does the gov. measure inflation from year to year? (6 Points) A. Current GDP C. Producer price index B. GDP price deflator D. Consumer price index

Which is a good explanation of the wage-price spiral? (8 Points) A. Fed. Produces more money, so wages go up C. Prices drop, then wages drop B. Wages go up when prices rise D. A funnel cloud produces by high wages

List the following from lowest to highest percentage: A. Rate for students A. Rate for students B. Prime rate B. Prime rate C. Discount rate C. Discount rate

…And the Winner Is… C. discount rate C. discount rate B. prime rate B. prime rate A. rate for students A. rate for students

Our current money is ? (1 Point) A. Specie money C. Backed by silver B. Inconvertible fiat money D. worthless

Properties, possessions…stuff you have? (2 Points) A. assets C. liquidity B. liabilities D. balances

Our current money has value because? (4 Points) A. It is backed by the gold std. C. It is portable, durable, and divisible B. Government said you must use it D. Public confidence in it

If a person robs a bank and your money is stolen, the gov. will insure it: (6 Points) A. True C. Only up to $1,000 B. False D. Only if the robber gets away

How does the Fed. influence your purchasing power? (8 Points) A. They incentivize borrowing C. They control the CPI B. They set prices of consumer goods D. They decide whether your check is good or not

List the following items in order based on percentage charged by banks: (starting with the lowest) A. Credit card A. Credit card B. Car loan B. Car loan C. Mortgage (home loan) C. Mortgage (home loan)

…And the Winner Is… C. Mortgage (home loan) C. Mortgage (home loan) B. Car loan B. Car loan A. Credit card A. Credit card

Who might get hurt by inflation? (1 Point) A. Consumers who don’t get a raise C. People with credit card debt B. Investors in the stock market D. Gold speculators

If the FED loaned BofA $10,000 at 5% interest, how much money will they make over one year? (2 Points) A. $5 C. $500 B. $50 D. $0 – the Fed doesn’t make a profit b/c they are part of the government

If the Treasury Dept. and FED wanted to encourage loose money policy, they might? (3 Points) A. Raise the reserve requirement C. Raise the Discount Rate B. Lower the reserve requirement D. Not wear a belt

Which would be an example of commodity money? (4 Points)A.C.B. D. Dolphin Teeth

If the FED used open market operations to get money out of circulation / fight inflation, it would? (5 Points) A. Sell t-bills C. Print money B. Buy t-bills D. Lower interest rates