Real Estate Economics – 5th Edition - by Huber, Messick, and Pivar
Chapter 3 Bonus Quiz
Copyright January 2011, Educational Textbook Company
1. After printing, money is distributed by the:
a. U.S. Treasury.
b. Federal Reserve.
c. Department of Commerce.
d. Executive Branch.
2. According to Irving Fisher, if we doubled the money supply we would:
a. double the price levels.
b. have deflation.
c. increase unemployment.
d. reduce production.
3. The Discount Rate is the rate:
a. a firm can discount its product for cash.
b. banks charge their most favored borrowers.
c. rate banks pay to borrow from the Federal reserve.
d. paid by government securities.
4. Which of the following is an expansionary policy of the Federal Reserve?
a. Increase the discount rate
b. Increase reserve requirements
c. Sell government bonds
d. Increase the money supply
5. Which of the following is most likely to be a contractionary policy of the Federal Reserve?
a. Reduce the discount rate
b. Reduce reserve requirements
c. Buy government bonds
d. Decrease the money supply
6. The country that has been buying the largest number of U.S. homes is:
a. China
b. India
c. Russia
d. Canada
7. Each loan origination point is equivalent to what rate of interests on a mortgage loan?
a. 1 percent
b. 1/2 percent
c. 1/4 percent
d. 1/8th percent
8. Which lender uses their own funds to directly arrange loans that they then sell?
a. Mortgage Broker
b. Mortgage Banker
c. Real Estate Investment Trust
d. Insurance Company
9. The prime rate is the:
a. interest paid a bank by its most favored customers.
b. APR.
c. nominal rate of interest.
d. LTV.
10. An example of fiat money would be:
a. gold bars.
b. silver coins.
c. U.S. paper currency.
d. Krugerands.
11. A single basis point is equal to:
a. 1 percent
b. .1 percent
c. .01 percent
d. .001 percent
12. The open market operations of the Federal Reserve consist of:
a. printing more money.
b. buying and selling government securities.
c. raising the discount rate.
d. lowering the federal funds rate.
13. PMI refers to:
a. Privileged Monetary Index.
b. Private Mortgage Insurance.
c. the Latin term Promus Medica Incus.
d. Preferred Mortgage Instigator.
14. A loan where a borrower was allowed to pay less than the interest is known as a(n):
a. fixed rate loan.
b. Renegotiable Rate Mortgage.
c. option ARM.
d. buy-down loan.
15. Silver coins disappeared form the marketplace. This is an example of:
a. the principle of comparative advantage.
b. exchange rates.
c. our negative balance of trade.
d. Gresham’s Law.
Real Estate Economics – 5th Edition - by Huber, Messick, and Pivar
Chapter 3 Bonus Quiz Answers
Copyright January 2011, Educational Textbook Company
1. a (p91)
2. b (p96)
3. c (p100)
4. d (p101)
5. d (p103)
6. d (p108)
7. d (p113)
8. b (p117)
9. a (p100)
10. c (p91)
11. c (p100)
12. b (p101)
13. b (p120)
14. c (p125)
15. d (p91)
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