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(econ333)[2005](f)final~masze^_10253.pdf
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Name _____________________

Student ID _____________________

Final Exam
Economics 333
Money and Banking
December 15, 2005

The exam is scheduled for 3 hours from 8:30-11:30. Write all answers on this exam paper. Do not hand in your blue bo

Multiple Choice (2 points each)

1.
Which of the following events would be the most likely to lead to an increase in discount window borrowing in Hong Kong


a.
An increase in the U.S. Fed Funds rate


b.
A decrease in the US Fed Funds rate


c.
an increase in the expected appreciation rate of the Hong Kong dollar


d.
a decrease in the expected depreciation rate of the Hong Kong dollar



_____D___________


2.
The bond traders of the US Federal reserve may engage in an open market sale of government bonds as


a.
dynamic transactions to reduce the interest rate or defensive transactions in response to an increase in the demand for reserves


b.
dynamic transactions to reduce the interest rate or defensive transactions in response to a decrease in the demand for reserves


c.
dynamic transactions to increase the interest rate or defensive transactions in response to an increase in the demand for reserves


d.
dynamic transactions to increase the interest rate or defensive transactions in response to a decrease in the demand for reserves





________D_______

3.
US savers become much less thrifty and decide to cut back on their savings. At the same time, corporations will decide to invest more in capital equipment. We can say,


a.
The price of bonds will clearly decrease while the change in the quantity of bonds will be ambiguous.


b.
The price of bonds will clearly increase while the change in the quantity of bonds will be ambiguous.


c.
The quantity of bonds will clearly decrease while the change in the price of bonds will be ambiguous.


d.
The quantity of bonds will clearly increase while the change in the price of bonds will be ambiguous.





_______A_________

4.
Which of the following is not a part of M2 in Hong Kong?


a.
Time deposits at commercial banks with maturities greater than 1 year


b.
Checking deposits at commercial banks


c.
Exchange Fund Bills held by banks


d.
Currency in Circulation





_______C_________

5.
Which of the following is the central bank of China?


a.
Peoples Bank of China


b.
Bank of China


c.
Mizuho Bank


d.
Industrial Commercial Bank of China





_________A_______


6.
The currency-to-deposit ratio will rise when


a.
the fear of bank runs declines.


b.
the expected return on deposits rises.


c.
the anonymity premium declines.


d.
the level of underground activity increases.





_________D_______

7.
Which of the following is NOT a regulatory ratio imposed on Hong Kong banks by the Hong Kong Moneta