经济学原理对应练习Ch 26.docx

经济学原理对应练习Ch 26.docx

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经济学原理对应练习Ch26

Chapter26

Saving,Investment,andtheFinancialSystem

MultipleChoice

1.Whenopeningarestaurantyoumayneedtobuyovens,freezers,tables,andcashregisters.Economistscalltheseexpenditures

a.capitalinvestment.

b.investmentinhumancapital.

c.businessconsumptionexpenditures.

d.Noneoftheaboveiscorrect.

ANS:

APTS:

1DIF:

1REF:

26-1

TOP:

InvestmentMSC:

Interpretive

2.WhenacountrysavesalargerportionofitsGDP,itwillhave

a.morecapitalandhigherproductivity.

b.morecapitalandlowerproductivity.

c.lesscapitalandhigherproductivity.

d.lesscapitalandlowerproductivity.

ANS:

APTS:

1DIF:

1REF:

26-1

TOP:

InvestmentMSC:

Definitional

3.Institutionsintheeconomythathelptomatchoneperson'ssavingwithanotherperson'sinvestmentarecollectivelycalledthe

a.FederalReservesystem.

b.bankingsystem.

c.monetarysystem.

d.financialsystem.

ANS:

DPTS:

1DIF:

1REF:

26-1

TOP:

FinancialsystemMSC:

Definitional

4.Lekeisha'sincomeexceedsherexpenditures.Lekeishaisa

a.saverwhodemandsmoneyfromthefinancialsystem.

b.saverwhosuppliesmoneytothefinancialsystem.

c.borrowerwhodemandsmoneyfromthefinancialsystem.

d.borrowerwhosuppliesmoneytothefinancialsystem.

ANS:

BPTS:

1DIF:

2REF:

26-1

TOP:

SupplyofloanablefundsMSC:

Definitional

5.Whichofthefollowingisnotcorrect?

a.Whenacountrysavesmore,ithasmorecapital.

b.Asupplierofloanablefundsborrowsmoney.

c.Theinterestrateadjuststobalancethequantitysuppliedofandthequantitydemandedofloanablefunds.

d.IfMarybuysequipmentforherfactory,Maryisengagingincapitalinvestment.

ANS:

BPTS:

1DIF:

1REF:

26-1

TOP:

Investment|Capital|MarketforloanablefundsMSC:

Definitional

6.Lucystartsherownpsychiatricpractice,butherexpenditurestoopenthepracticeexceedherincome.Lucyisa

a.saverwhodemandsmoneyfromthefinancialsystem.

b.saverwhosuppliesmoneytothefinancialsystem.

c.borrowerwhodemandsmoneyfromthefinancialsystem.

d.borrowerwhosuppliesmoneytothefinancialsystem.

ANS:

CPTS:

1DIF:

1REF:

26-1

TOP:

SupplyofloanablefundsMSC:

Definitional

7.Abondisa

a.financialintermediary.

b.certificateofindebtedness.

c.certificateofpartialownershipinanenterprise.

d.Noneoftheaboveiscorrect.

ANS:

BPTS:

1DIF:

1REF:

26-1

TOP:

BondsMSC:

Definitional

8.Whichofthefollowingwouldbeanexampleofdirectfinance?

a.Asaverbuyssharesinamutualfund.

b.Asaverdepositsmoneyintoacreditunion.

c.Asaverbuysabondacorporationhasjustissuedsoitcanpurchasecapital.

d.Noneoftheaboveiscorrect.

ANS:

CPTS:

1DIF:

1REF:

26-1

TOP:

Bonds|DirectfinanceMSC:

Interpretive

9.Acertificateofindebtednessthatspecifiestheobligationsoftheborrowertotheholderiscalleda

a.bond.

b.stock.

c.mutualfund.

d.Alloftheabovearecorrect.

ANS:

APTS:

1DIF:

1REF:

26-1

TOP:

BondsMSC:

Definitional

10.Ifthegovernment'sexpendituresexceededitsreceipts,itwouldlikely

a.lendmoneytoabankorotherfinancialintermediary.

b.borrowmoneyfromabankorotherfinancialintermediary.

c.buybondsdirectlyfromthepublic.

d.sellbondsdirectlytothepublic.

ANS:

DPTS:

1DIF:

2REF:

26-1

TOP:

Bonds|DirectfinanceMSC:

Interpretive

11.MegasoftwantstofinancethepurchaseofnewequipmentfordevelopingsecuritysoftwarecalledDoors,buttheyhavelimitedinternalfunds.Megasoftwilllikely

a.demandloanablefundsbybuyingbonds.

b.demandloanablefundsbysellingbonds.

c.supplyloanablefundsbybuyingbonds.

d.supplyloanablefundsbysellingbonds.

ANS:

BPTS:

1DIF:

2REF:

26-1

TOP:

Investment|MarketforloanablefundsMSC:

Interpretive

12.SkylineChiliwantstofinancethepurchaseofnewequipmentforitsrestaurants,buttheyhavelimitedinternalfunds.Skylinewilllikely

a.demandloanablefundsbybuyingbonds.

b.demandloanablefundsbysellingbonds.

c.supplyloanablefundsbybuyingbonds.

d.supplyloanablefundsbysellingbonds.

ANS:

BPTS:

1DIF:

2REF:

26-1

TOP:

Investment|MarketforloanablefundsMSC:

Interpretive

13.IfProctorandGamblesellsabonditis

a.borrowingdirectlyfromthepublic.

b.borrowingindirectlyfromthepublic.

c.lendingdirectlytothepublic.

d.lendingindirectlytothepublic.

ANS:

APTS:

1DIF:

2REF:

26-1

TOP:

Bonds|DirectfinanceMSC:

Interpretive

14.Whichofthefollowingiscorrect?

a.Thematurityofabondreferstotheamounttobepaidback.

b.Theprincipalofthebondreferstothepersonsellingthebond.

c.Abondbuyercannotsellabondbeforeitmatures.

d.Noneoftheaboveiscorrect.

ANS:

DPTS:

1DIF:

1REF:

26-1

TOP:

BondsMSC:

Definitional

15.Whichofthefollowingisnotanonsensicalheadline?

a.Britishperpetuitiesabouttomature.

b.Disneyissuesnewbondswithtermof$1,000each.

c.Governmentbondscurrentlypaylessinterestthancorporatebonds.

d.StandardandPoor'sjudgesnewjunkbondtohaveverylowcreditrisk.

ANS:

CPTS:

1DIF:

2REF:

26-1

TOP:

BondsMSC:

Interpretive

16.Thelengthoftimeuntilabondmaturesiscalledthe

a.perpetuity.

b.term.

c.maturity.

d.intermediation.

ANS:

BPTS:

1DIF:

1REF:

26-1

TOP:

Bonds|TermMSC:

Definitional

17.Aperpetuityisdistinguishedfromotherbondsinthatit

a.payscontinuouslycompoundedinterest.

b.paysinterestonlywhenitmatures.

c.nevermatures.

d.willbeusedtopurchaseanotherbondwhenitmaturesunlesstheownerspecifiesotherwise.

ANS:

CPTS:

1DIF:

1REF:

26-1

TOP:

PerpetuityMSC:

Definitional

18.Whichofthefollowingiscorrect?

a.Somebondshavetermsasshortasafewmonths.

b.Becausetheyaresorisky,junkbondspayalowrateofinterest.

c.Corporationsbuybondstoraisefunds.

d.Alloftheabovearecorrect.

ANS:

APTS:

1DIF:

1REF:

26-1

TOP:

BondsMSC:

Interpretive

19.Whichofthefollowingisnotcorrect?

a.Ifyoubuyabondfromacorporation,youcansellthebondtosomeoneelsebeforeitmatures.

b.Datetomaturityreferstotheschedulingofperiodicinterestratepaymentsonabond.

c.AbondisanIOU.

d.TherearemillionsofdifferentbondsintheU.S.economy.

ANS:

BPTS:

1DIF:

1REF:

26-1

TOP:

BondsMSC:

Definitional

20.Abondthatnevermaturesisknownasa

a.perpetuity.

b.anintermediarybond.

c.anindexedbond.

d.ajunkbond.

ANS:

APTS:

1DIF:

1REF:

26-1

TOP:

PerpetuityMSC:

Definitional

21.Whichofthefollowingiscorrect?

a.Lenderssellbondsandborrowersbuythem.

b.Long-termbondsusuallypayalowerinterestratethandoshort-termbondsbecauselong-termbondsareriskier.

c.Junkbondsrefertobondsthathavebeenresoldmanytimes.

d.Noneoftheaboveiscorrect.

ANS:

DPTS:

1DIF:

1REF:

26-1

TOP:

BondsMSC:

Definitional

22.Long-termbondsaregenerally

a.lessriskythanshort-termbondsandsopayhigherinterest.

b.lessriskythanshort-termbondsandsopaylowerinterest.

c.moreriskythanshort-termbondsandsopayhigherinterest.

d.moreriskythanshort-termbondsandsopaylowerinterest.

ANS:

CPTS:

1DIF:

1REF:

26-1

TOP:

BondsandriskMSC:

Definitional

23.Comparedtolong-termbonds,otherthingsthesame,short-termbondsgenerallyhave

a.moreriskandsopayhigherinterest.

b.lessriskandsopaylowerinterest.

c.lessriskandsopayhigherinterest.

d.aboutthesameriskandsopayaboutthesameinterest.

ANS:

BPTS:

1DIF:

1REF:

26-1

TOP:

BondsandriskMSC:

Definitional

24.Onwhichbondisdefaultmostlikely?

a.ajunkbond

b.amunicipalbond

c.aU.S.governmentbond

d.acorporatebondissuedbyProctorandGamble.

ANS:

APTS:

1DIF:

1REF:

26-1

TOP:

BondsandriskMSC:

Definitional

25.Assumingthatthebondsbelowhavethesametermandprincipalandthatthestateorlocalgovernmentwhichissuesthemunicipalbondhasagoodcreditrating,whichlisthasbondsorderedfromtheonethatpaysthemostinteresttotheonethatpaystheleastinterest?

a.corporatebond,municipalbond,U.S.governmentbond

b.corporatebond,U.S.governmentbond,municipalbond

c.municipalbond,U.S.governmentbond,corporatebond

d.U.S.governmentbond,municipalbond,corporatebond

ANS:

BPTS:

1DIF:

2REF:

26-1

TOP:

BondsandriskMSC:

Interpretive

26.Otherthingsthesame,asthematurityofabondbecomeslonger,thebondwillpay

a.lessinterestbecauseithaslessrisk.

b.lessinterestbecauseithasmorerisk.

c.moreinterestbecauseithasmorerisk

d.Thereisnorelationbetweentermtomaturityandrisk.

ANS:

CPTS:

1DIF:

2REF:

26-1

TOP:

BondsandriskMSC:

Interpretive

27.SupposethecityofCincinnatihasahighcreditrating.

a.Thehighcreditratingandthetaxstatusofmunicipalbondsshouldbothmaketheinterestratelowerthanotherwise.

b.Thehighcreditratingandthetaxstatusofmunicipalbondsshouldbothmaketheinterestratehigherthanotherwise.

c.Thehighcreditratingshouldmaketheinterestratehigherthanotherwise.Thetaxstatusofmunicipalbondsshouldmaketheinterestratelowerthanotherwise.

d.Thehighcreditratingshouldmaketheinterestratelowerthanotherwise.Thetaxstatusofmunicipalbondsshouldmaketheinterestratehigherthanotherwise.

ANS:

APTS:

1DIF:

2REF:

26-1

TOP:

InterestonbondsMSC:

Applicative

28.Municipalbondspayarelatively

a.lowrateofinterestbecauseoftheirhigh-defaultriskandbecausetheinteresttheypayissubjecttofederalincometax.

b.lowrateofinterestbecauseoftheirlow-defaultriskandbecausetheinteresttheypayisnotsubjecttofederalincometax.

c.highrateofinterestbecauseoftheirhigh-defaultriskandbecausefederaltaxesmustbepaido