The exchange rate: (Multiple Choice)

The exchange rate
 A) is the price of one country's money in terms of another country's money.
  B) is largely determined by Treasury budget policy.
  C) is not a market-determined price.
  D) has little impact on the balance sheet and income statements of businesses with foreign holdings.

QUESTION 2

Austrian economists
 A) supported TARP legislation.
  B) believe that no bank is to big to fail.
  C) and Keynesian economists have consistent views concerning the role of government.
  D) none of these choices.

QUESTION 3

Subprime mortgages
 A) are loans covered by reserve requirements of commercial banks.
  B) are home loans backed by the Treasury.
  C) are home loans given to individuals without credit to meet the loan requirements.
  D) none of these choices.

QUESTION 4

The mortgage crisis started to come to a head
 A) when the Federal Reserve started to raise interest rates.
  B) when government deficit started to grow at increasing rates.
  C) when the Federal Reserve passed a law aimed at getting every American to own their own home.
  D) a. and b. are true

QUESTION 5

One can invest in a pool of mortgages by buying
 A) long term bonds.
  B) mortgage backed securities.
  C) penny stocks.
  D) stocks with a beta of less than one.

QUESTION 6

The financial crisis of 2008
 A) had its roots in the internet crisis of 2000.
  B) had its roots in the budget policy of the Treasury.
  C) had its roots in the real estate market.
  D) all of these choices.

QUESTION 7

The Employment Act of 1946 was built largely out of
 A) philosophy of William J. Boyes.
  B) free market economic philosophy.
  C) the ideas of Milton Friedman.
  D) Keynesian philosophy.

QUESTION 8

Free market economists
 A) believe in the fundamental stability of the economy.
  B) believe that government policy can create a stable economy.
  C) and Keynesians hold the same macroeconomic views.
  D) believe that the Federal Reserve is the source of economic stability.