Some financial institutions are classified as depository institutions based on: a. the way they acquire funds. b. the size of the loans they make. O c. the number of customers they have. d. the number of loans they make. O e. the amount of reserves they hold.

Question 22 The functions of depository institutions include O maximizing M1 and M2 O pooling risk O providing debt counselling O providing credit ratings

1. What is the primary social function of the financial system? a. To direct financial capital to its highest and best use b. To maximize shareholder returns c. To maintain a steady stream of financial innovations d. To find unexploited profit opportunities 2. What is the primary challenge of a barter economy? Successful transactions require transporting and distributing goods from one location to another b. Successful transactions require consumers to gather information on a variety of goods and services and pick a combination that maximizes consumer utility c. Successful transactions require producers to manage a complex set of inputs d. Successful transactions require the realization of a double coincidence of wants 3. Technically, money is a. The base good for which all other goods and services are traded b. The commodity of greatest value in a society c. Always a fiat currency d. The object of production

What is the role of a commercial bank? O a. To create money through the banking system O b. To maximize profits for its shareholders O c. To take customers' deposits and make loans O d. All of the answers are correct