BANKING AND FINANCE TEST EXAM
2025 QUESTIONS AND ANSWERS
In a less-developed economy, cattle is widely accepted as payment for goods and services.
Nearly all goods and services are priced in terms of cattle; however, cows vary in quality,
become less valuable with age, and are difficult to move over long distances. Which of the
following functions of money do cattle provide? - ANS 1) medium of exchange
2) unit of account
By the end of the nineteenth century, the United States banking system transitioned from -
ANS a decentralized system of state banks to a centralized system of state and national
banks.
The First Bank of the United States had characteristics that differ from those of the modern
central bank of the United States. Which of the following is one such characteristic of the First
Bank of the United States? - ANS The First Bank of the United States was partially owned by
foreign investors.
How does fractional-reserve banking influence the money supply in the United States? -
ANS Fractional-reserve banks issue depositor funds to borrowers, increasing the number of
claims made on the same dollars.
Which of the following is a lasting impact resulting from 20th-century banking reforms in the
United States? - ANS Depositor funds are insured against potential loss in the event of a bank
failure.
1 @COPYRIGHT THESTAR 2025/2026
2025 QUESTIONS AND ANSWERS
In a less-developed economy, cattle is widely accepted as payment for goods and services.
Nearly all goods and services are priced in terms of cattle; however, cows vary in quality,
become less valuable with age, and are difficult to move over long distances. Which of the
following functions of money do cattle provide? - ANS 1) medium of exchange
2) unit of account
By the end of the nineteenth century, the United States banking system transitioned from -
ANS a decentralized system of state banks to a centralized system of state and national
banks.
The First Bank of the United States had characteristics that differ from those of the modern
central bank of the United States. Which of the following is one such characteristic of the First
Bank of the United States? - ANS The First Bank of the United States was partially owned by
foreign investors.
How does fractional-reserve banking influence the money supply in the United States? -
ANS Fractional-reserve banks issue depositor funds to borrowers, increasing the number of
claims made on the same dollars.
Which of the following is a lasting impact resulting from 20th-century banking reforms in the
United States? - ANS Depositor funds are insured against potential loss in the event of a bank
failure.
1 @COPYRIGHT THESTAR 2025/2026
