Question

25. Central Vermont Power sold $200 million of bonds to finance a major upgrade of one of its largest power plants. The sale of these bonds indicates that Central Vermont utilizes equity capital to meet its long-term financing needs. A) True B) False 26. Using fresh fruits and vegetables as money fails to achieve the desired characteristic of useful money. A) objectivity. B) seasonality. C) transferability D) durability 27. The Board of Governors of the Federal Reserve System determines: A) exchange rates. B) U.S. monetary policy. C) and monitors the inflows and outflows of gold reserves to ensure a stable money supply. D) how muchmoney the U.S. will loan to foreign governments. 28. The Fed uses A) stockmarket investments B) the deposit requirement C) the political negotiation process D) the discount rate to regulate the money supply. 29. Under the Federal Reserve Act of 1913: A) membership in the Federal Reserve System was made voluntary for all banks. B) federally chartered banks were required to join the Federal Reserve System C) membership in the Federal Reserve System was required of all banks that had deposits of more than $1 million. D) all banks were required to hold reserves equal to at least 50 percent of their deposits. 30. Which of the following historical events motivated Congress to establish the Federal Reserve System? A) The significant outflow of gold during the Civil War. B) The collapse of the Second National Bank of the United States. C) The banking panic and cash shortage of 1907. D) The Great Depression.

Answer 1

25. Option B, false [ it uses debt capital to meets its long term financing needs]

26. Option C, transferability

27. Option B, U.S. monetary policy

28. Option D, discount rate

29. Option B, federally chartered banks were required to join the federal reserve system

30. Option c, The banking panic and cash shortage of 1907