Precautionary cash balances

Precautionary cash balances:

A. are invested in insurance policies by people who are highly risk-averse.

B. were emphasized by classical writers on monetary theory.

C. are intended primarily for unexpected expenditures.

D. grow when individuals acquire personal lines of credit.

Question 2

Money is NOT:

A. a medium of exchange.

B. a standard of value.

C. a store of value.

D. the exclusive means of holding wealth.

Question 3

The first bankers were:

A. goldsmiths.

B. printers.

C. storekeepers.

D. innkeepers.

Question 4

One of the main results of the Depository Institutions Deregulation and Monetary Control Act of 1980 may be to:

A. lessen the number of financial institutions in the United States.

B. increase the number of financial institutions in the United States.

C. discourage the formation of big, nationwide, all-purpose financial institutions.

D. make it easier for the member banks to borrow money from the Federal Reserve District Banks.