Real Estate Finance Test #1 Certification Review Exam Questions And Answers Guaranteed Pass.
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Course
REAL ESTATE FINANCE.
Institution
REAL ESTATE FINANCE.
Hypothecation - correct answer Pledge of collateral to a lender.
Debenture Bonds - correct answer An unsecured promise to pay.
The Fed influences the economy through what 4 ways? - correct answer ...
Hypothecation - correct answer Pledge of collateral to a lender.
Debenture Bonds - correct answer An unsecured promise to pay.
The Fed influences the economy through what 4 ways? - correct answer 1)
Controlling currency circulation.
2) Adjusting amount of funds available within the commercial banking network through "open market
operations".
3) Signaling interest rate movements through changes in the discount rate.
4) Setting cash reserve requirements for depository institutions.
Too much money in circulation can cause what? - correct answer Inflation
Too little money in circulation can cause what? - correct answer Recession
What committee decides whether or not to increase the money supply? - correct answer
Open Market Committee
Who is responsible for raising money to pay the nations bills? - correct answer The
U.S. Treasury
Commercial paper - correct answer An unsecured promise to pay (Corporate IOU),
typically a short-term.
The Federal Reserve board is comprised of how many members, serving how long, and appointed by
who? - correct answer There are 7 governors (including a chair) on the board, each
serving 14 year terms appointed by the president. The chair serves only a 4 year term, non-concurrent
with the president.
, The Federal Reserve Chair influences what? - correct answer Has the authority to
influence the selection of the 12 Federal Reserve districts, and also influences the selection of which of
the 5 out of 12 members that will serve on the Open Market Committee.
Federal Open Market Committee (FOMC) - correct answer Comprised of 7
governors and 5 of the 12 Federal Reserve District presidents.
Discount rate - correct answer The rate charged by the Fed to depository
institutions that are eligible to borrow from it. The current discount rate is 1.75%.
Where does the Treasury get the money to pay the nations bills? - correct answer
Tax revenues, borrowed funds, and printing money
The demand for credit comes from what 4 sources? - correct answer Government,
corporate, mortgage loans, and consumers.
Prime rate - correct answer Used as a base upon which to float an interest rate for
various loan types. Currently 4.25%.
T-bill rates are a good indicator of what? - correct answer Short-term market
interest rates.
Usury Laws - correct answer State laws that limit the amount of interest that may
be charged on different kinds of loans and to various borrower categories.
What is the current usury rate in Arkansas? - correct answer 17%
Open Market Operations - correct answer A tool the Fed can use to influence the
economy. Because it has access to a large supply of both government bonds and cash, the Fed can move
these assets in and out of the banking system at any time it deems desirable.
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