1. What is a difference between the ECB and the FED?
   1. Importance of open market operations
   2. The degree of independence
   3. Determination of budget
   4. Importance in a global perspective, i.e., impact on world economy
2. What is the clear advantage of having an independent Central Bank?
   1. Avoidance of a so-called political business cycle
   2. Monetary policies are easier to implement
   3. The government will receive the profits of the Central Bank
   4. Coordination between monetary and fiscal policy is easier to achieve
3. Which factor is not used to calculate the money multiplier?
   1. The currency ratio
   2. The required reserve ratio
   3. The monetary base
   4. The excess reserves ratio
4. An economy has excess reserves of 0.5 billion, checkable deposits amounting to 1400 billion and 600 billion worth of currency. The required reserve ratio is 10%. What is the simple deposit multiplier?
   1. 1
   2. 10
   3. 2.70
   4. 5.83
5. Who implements monetary policy? A) The Executive Board of the ECB
   1. The Board of Governors of the Federal Reserve System
   2. The National Central Banks of the Eurosystem
   3. The Federal Reserve Banks of the Federal Reserve System
6. In response to the sovereign debt crisis in Europe, the ECB decided to introduce long-term refinancing operations (LTROs). What does this mean?
   1. Long-term obligation by the ECB to purchase government bonds of countries with severe debts until the bond yields returned to acceptable levels
   2. Provide liquidity to troubled banks by long-term loans
   3. Promise by the ECB to serve as a "lender of last resort", in particular for deficit countries
   4. Allowing commercial banks to deposit reserves for longer periods at the ECB
7. Why did the ECB introduce a large government bond purchase program in response to the financial crisis (as started in 2007)?
   1. To assist large debt countries to meet their loan obligations by increasing the price of government bonds
   2. To assist large debt countries to meet their loan obligations by decreasing the price of government bonds
   3. To facilitate the interbank lending market
   4. To help governments of current account surplus countries to attract funding at financial markets