Question

27. The Fed s major concern in supervising the activities of financial institutions is to

Select one:

a. maintain an efficient payment system.

b. promote the efficient functioning of investment banks.

c. reduce the cost of borrowing and lending.

d. promote the soundness and the safety of depository institutions.

28.

The Federal Reserve regulates and supervises the financial system for the following reasons except

Select one:

a. to promote the smooth running and efficiency of the economy.

b. to influence the level of interest rate and level of funding in the economy.

c. to reduce competition while preserving the safety and soundness of the system.

d. to reduce the cost and increase the availability of funds in the economy.

29.

In the ____ market, transactions are entered today for future delivery.

Select one:

a. spot

b. capital

c. money

d. futures or forward

30.

The open market operations of the Fed involves

Select one:

a. maintaining an open market to ensure timely execution of trade.

b. buying and selling of U.S. government securities in the open market.

c. increasing or decreasing the banks reserve requirements to change the money supply.

d. opening credit lines to banks in distress or in need of reserves.

Answer 1

27) The answer is a. ) maintain an efficient payment system.

because Fed supervision all the financial insittution that they are working according to the regualtions set by the Fed to maintain an efficient payment system .

28) The answer is B -) to reduce competition while preserving the safety and soundness of the system.

29) The answer is D -) Futures or Forwards.

because in futures or forwards markets, The transactions are occured in the today to promise the delivery in the future .

30) The answer is B -) b. buying and selling of U.S. government securities in the open market.