TEST 5

I. Choose the words for the right meaning

1. inflation A. includes both cash and deposits that can be used almost as easily as cash.

2. core B. in good condition

3. threats C. basic and most important

4. oversight D. support a temporary personal or business capital need.

5. target E. a loan made by an investor to a borrower

6. Policy F. a general, continuous increase in prices

7. Sterling G. potential sources of danger

8. sound H. the name of the British currency

9. remunerated I. is the procedure by which financial trades settle

10. risk J. used to back liabilities and influence monetary policy.

11. foreign exchange reserves K. supervision

12. bank reserves L. whereby nominal target interest rates are set with a negative value

13. clearing M. a level or situation which you intend to achieve

14. exchange Rate N. minimum cash level required by the central bank.

15. negative interest rate O. rest rate charged to commercial banks and other financial institutions for
policy short-term loans they take

16. Money Supply P. is the value of one nation's currency versus the currency of another
nation

17. Bonds Q an agreed plan of what to do

18. discount rate R. paid

19. Sterling S. actual gains will differ from an expected outcome or return.

20. Short Term Loan T. the name of the British currency

Answer:
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
F C G K M Q T B R S J N I P L A E O T D

II. Choose the best words

1. "Accounts receivable" is money owed to a company, ____________ “accounts payable” is money owed
by the company to creditors.
A. whereas B. otherwise C. such as D. in order that
2. ________ is a fall in the overall level of prices in an economy and an increase in the purchasing power of
the currency.
A. Deflation B. Disinvestment C. Investment D. Transaction
3. Written promises to pay a specific amount of money within a specified time are called ____________.
A. Vouchers B. Invoices C. Notes D. Checks
4. One of the negotiable instruments that are commonly used by businesses is ____________.
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A. Invoice B. Voucher C. Money order D. Cash

5. A device used in place of cash in a transaction is ____________.

A. negotiable instrument B. obligation
C. franchise D. legal entity
6. Current assets are cash or other assets which are convertible to cash within ____________.
A. one year B. two years C. three years D. four years
7. ____________ is a person who purchases a product or service for personal use; the last link in the
distribution chain.
A. employee B. consumer C. retailer D. wholesaler
8. Drawings are cash, stock or anything else of value that the owner ____________ the business for
personal use.
A. takes out of B. put into C. invest in D. commences
9. The twelve-month accounting period is known as ____________.
A. The least active point period B. The fiscal year
C. The calendar year D. The business cycle
10. A business that acquires goods to sell to the general public is called ____________.
A. A service business B. A manufacturing business
C. A wholesale business D. A trade retail business
11. _____ can be converted into ready cash without affecting its market price.
A. An oil refinery B. Liquidity C. A steel mill D. An electronic factory
12. ______ is the deliberate downward adjustment of the value
A. Remunerated B. A toy factory C. Portfolio D.Currency Devaluation
13. Obligations that must be paid within the current fiscal period are ____________.
A. Working capital B. Long - term liabilities
C. Short - term liabilities D. Current assets
14. Which of the following items is not included in intangible assets?
A. Franchises B. Copyrights C. Goodwill D. Bonds
15. ____________ is the financial statement that shows the assets, liabilities, and owners' equity of a
business at a point of time.
A. Income statement B. Statement of cash flow
C. Balance sheet D. Statement of owners' equity
16. __________ occurs when expenses exceed revenue.
A. Margin B. Copyrights C. Budget deficit D. Bonds
17. ___________ includes both cash and deposits that can be used almost as easily as cash.
A. Operating cash flow B. Credit limit
C. Maturity D. Money Supply
18. ___________ seek to deliberately depreciate the value of their domestic currencies
in order to stimulate their economies.
A. Publish monetary B. Stability C. Currency war D. Insentive
19. Current transaction ____________ commands ignored until end of transaction block.
A. aborted B. is aborted C. abort D. has aborted
20. Capital transactions ____________that have a long-term effect on the business.
A. transactions B. will transactions C. have transactions D. are transactions
Answer:
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

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 B A D C A A B C B D B D C C C C D C B D

III. Complete the following sentences with prompts

1. The central bank/ be/ usually /responsible/ for/ formulation /of /monetary policy/ and/ regulation/ of /
member bank/.

…………………………………………………………………………………………………………………..
2. The critical feature/ a central bank/ gives/ it/ the privilege/ to /issue/ banknotes/ and /cash/.
.............................................................................................................................................................................
.
…………………………………………………………………………………………………………………..
3. A central bank/ can/ be/ a lender/ of/ last/ resort/ to/ troubled financial/ institutions/ and /even/
government/.
.............................................................................................................................................................................
.
…………………………………………………………………………………………………………………..
4. The central bank/ provide/ politically/ attractive/ alternative/ to/ taxation/ when/ government/ need/
to/ increase/ revenue/.
.............................................................................................................................................................................
.
…………………………………………………………………………………………………………………..
5. The Federal Reserve/ be/ sign/ into /law /President Woodrow Wilson/ in 1913/ follow/ a series/ of
/financial panic/ that /left/ many/ commercial banks/ around /the country bankrupt/.
.............................................................................................................................................................................
.
…………………………………………………………………………………………………………………..
6. Central bank/ action/ be/ often/ poorly /understood/ raise/ the level/ of/ suspicion/.
.............................................................................................................................................................................
.
…………………………………………………………………………………………………………………..
7. Central bank/ create/ money/ by / issue/ banknote/ and/ loan/ them/ to/ the government/ in/
exchange/ for/ interest-bearing/ asset/ such as/ government/ bond/.
.............................................................................................................................................................................
.
…………………………………………………………………………………………………………………..
8. A central bank/ affect/ the monetary/ base/ through/ open / market/ operation/, if/ it/ country/ have/
a /well/ develop/ market/ for/ it/ government bond/.
.............................................................................................................................................................................
.
………………………………………………………………………………………………………………….
9. Most/ country/ around/ world/ has/ a / central bank/ and/ many/ purposely/ give/ bank/ a degree/ of/
autonomy/ from/ the rest/ of/ government/.
.............................................................................................................................................................................
.
…………………………………………………………………………………………………………………..
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 10. There/ be/ also/ institution/ in / the United States/ call/ Central Bank/ that/ be/ actually/ commercial
banks/.
.............................................................................................................................................................................
.
…………………………………………………………………………………………………………………..
11. Central Bank/ intervene/ in/ currency markets/ today/ try/ stabilize/ exchange rate/.
.............................................................................................................................................................................
.
…………………………………………………………………………………………………………………..
12. Central Bank/ aim/ develop/ a/ robust framework/ in/ place/ ensure/ that/ fail/ or/ failing regulated
firms/ go/ through/ an orderly resolution/.
.............................................................................................................................................................................
.
…………………………………………………………………………………………………………………..
13. Do/ you/ wish/ be pay/ in cash/ or/ by cheque/?
.............................................................................................................................................................................
.
…………………………………………………………………………………………………………………..
14. Central banks/ affect/ economic growth/ by/ control/ liquidity/in/ financial system/.
.............................................................................................................................................................................
.
…………………………………………………………………………………………………………………..
15. If/ central banks/ stimulate/ economy/ much/ they/ can/ trigger/ inflation/.
.............................................................................................................................................................................
.
………………………………………………………………………………………………………………….
16. Central banks/ also/ regulate/ exchange rates/ as/ a way/ control/ inflation/.
.............................................................................................................................................................................
.
………………………………………………………………………………………………………………….
17. A central bank/ be/ an independent national authority/ conduct/ monetary policy/ regulate/banks/
provide/ financial services/ include/ economic research/.
.............................................................................................................................................................................
.
………………………………………………………………………………………………………………….
18. The Central Bank/ set/ interest rates/ target/ low inflation/ maintain/ economic growth/.
.............................................................................................................................................................................
.
………………………………………………………………………………………………………………….
19. If/ banks/ get into/ liquidity shortages/ then/ Central Bank/ be able/ lend/ commercial bank/ sufficient
funds/ avoid/ bank running short/.
.............................................................................................................................................................................
.
…………………………………………………………………………………………………………………..
20. Central Bank/ aim/ ensure/ that/ regulated firms/ be/ financially sound/ and/ safely managed/.
.............................................................................................................................................................................
.

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…………………………………………………………………………………………………………………..

1. The central bank is usually responsible for the formulation of monetary policy and the
regulation of member banks.
2. The critical feature of a central bank,which gives it the privilege to issue banknotes and cash.
3. A central bank can be a lender of last resort to troubled financial institutions and
even governments.
4. The central bank provides a politically attractive alternative to taxation when a government
needs to increase revenue.
5. The Federal Reserve was signed into law by President Woodrow Wilson in 1913 following a
series of financial panics that left many commercial banks around the country bankrupt.
6. Central bank actions are often poorly understood, raising the level of suspicion.
7. Central banks create money by issuing banknote and loaning them to the government in
exchange for interest-bearing assets such as government bonds.
8. A central bank affects the monetary base through open market operation, if its country has a
well developed market for its government bonds.
9. Most countries around the world have a central bank and many purposely give the bank a
degree of autonomy from the rest of the government.

10. There are also institutions in the United States called Central Bank that are actually
commercial banks.
11. The Central Bank intervened in the currency markets today to try to stabilize the exchange
rate.
12. The Central Bank aims to develop a robust framework in place to ensure that failed or failing
regulated firms go through an orderly resolution.
13. Do you wish to be paid in cash or by cheque?
14. Central banks affect economic growth by controlling the liquidity in the financial system.
15. If central banks stimulate the economy too much, they can trigger inflation.
16. Central banks also regulate exchange rates as a way to control inflation.
17. A central bank is an independent national authority that conducts monetary policy, regulates
banks, and provides financial services including economic research.
18. The Central Bank set interest rates to target low inflation and maintain economic growth.
19. If banks get into liquidity shortages then the Central Bank is able to lend the commercial bank
sufficient funds to avoid the bank running short.
20. The Central Bank aims to ensure that regulated firms are financially sound and safely
managed.

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 IV. English-Vietnamese translation
1. The Central Bank will take full responsibility for the monetary policy in a country or territory.
.............................................................................................................................................................................
.
………………………………………………………………………………………………………………….
2. Most central banks will be run by an independent senior board of directors.
.............................................................................................................................................................................
.
………………………………………………………………………………………………………………….
3. The Central Bank is a part of the State's powerful agency that directly performs the task of money
management and circulation, also known as monetary policy.
.............................................................................................................................................................................
.
………………………………………………………………………………………………………………….
4. The central bank can lend to intermediaries either as a bank of banks or as a regulatory bank.
.............................................................................................................................................................................
.
………………………………………………………………………………………………………………….
5. The central bank provides credit to intermediary banks in the following forms: refinancing loans and
payment loans.
.............................................................................................................................................................................
.
………………………………………………………………………………………………………………….
6. To bring many economic benefits, the central bank always plays an important role. Especially in the
process of economic growth and the general development of the economy is not overloaded.
.............................................................................................................................................................................
.
………………………………………………………………………………………………………………….
7. The central bank organizes and conducts short-term trading of valuable papers with commercial banks
and credit institutions on the open market.
........................................................................................................................................................ ...................
. ...........................................................................................................................................................................
....

8. The Bank of England was the first to officially admit it would provide loans as a last resort for smaller
private banks and even the government.
........................................................................................................................................................ ...................
. ...........................................................................................................................................................................
....
9. The Central Bank performs the state management of money and banking operations in order to ensure
the safety and efficiency of the banking system's operations.
........................................................................................................................................................ ...................
. ...........................................................................................................................................................................
....

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10. The central bank must have strong enough foreign exchange reserves to intervene in the market when
necessary
........................................................................................................................................................ ...................
. ...........................................................................................................................................................................
....
11. The Fed is considered an independent central bank because monetary policy decisions do not need to
be approved by the President or anyone else in the executive or legislative branches of government.
Fees from the United States Congress apportioned by federal policy each year.
........................................................................................................................................................ ...................
. ...........................................................................................................................................................................
....
12. The central bank controls and coordinates a country's money supply by issuing currency and fixing
interest rates on bond loans.
........................................................................................................................................................ ...................
. ...........................................................................................................................................................................
....
13. The central bank also acts as the "owner" of emergency loans to troubled commercial banks and other
institutions, and sometimes to the government.
........................................................................................................................................................ ...................
. ...........................................................................................................................................................................
....
14. France's Napoleonic central bank and Germany's Reichsbank, again established for the purpose of
financing costly military operations by the government
........................................................................................................................................................ ...................
. ...........................................................................................................................................................................
....
15. The Central Bank provides credit to banks and credit institutions in order to ensure that the economy
has enough necessary payment means in each period.
........................................................................................................................................................ ...................
. ...........................................................................................................................................................................
....
16. Banknotes issued by the Central Bank are legal means of payment, as a means of information storage
and as a means of payment.
........................................................................................................................................................ ...................
. ...........................................................................................................................................................................
....
17. The Central Bank represents the State in foreign relations in the fields of currency, credit and banking.
........................................................................................................................................................ ...................
. ...........................................................................................................................................................................
....
18. Central bank management of foreign exchange reserves and foreign exchange policy.
........................................................................................................................................................ ...................
. ...........................................................................................................................................................................
....
19. The Central Bank has a unique position in the State's machinery and macro-management apparatus.

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........................................................................................................................................................ ...................
. ...........................................................................................................................................................................
....
20. The Central Bank performs the management function not only through laws and administrative
measures, but also through profitable business operations.
........................................................................................................................................................ ...................
. ...........................................................................................................................................................................
....

1. Ngân hàng Trung ương sẽ chịu trách nhiệm hoàn toàn về các chính sách tiền tệ trong một quốc
gia hoặc vùng lãnh thổ.
2. Hầu hết những ngân hàng Trung ương sẽ được điều hành bởi hội đồng quản trị cấp cao hoạt
động độc lập.
3. Ngân hàng Trung ương thuộc bộ phận cơ quan quyền lực của Nhà nước trực tiếp thực hiện
nhiệm vụ quản lý và lưu thông tiền tệ hay còn gọi là chính sách tiền tệ.
4. Ngân hàng trung ương có thể cho vay đối với các ngân hàng trung gian với tư cách là ngân
hàng của các ngân hàng hoặc với tư cách là ngân hàng điều tiết.
5. Ngân hàng trung ương cấp tín dụng cho các ngân hàng trung gian dưới các hình thức: Cho vay
tái cấp vốn và cho vay thanh toán.
6. Để đem lại nhiều lợi ích kinh tế thì ngân hàng Trung ương luôn nắm một vai trò quan trọng.
Đặc biệt trong quá trình tăng trưởng kinh tế và sự phát triển chung của nền kinh tế không bị
quá tải.
7. Ngân hàng trung ương tổ chức và thực hiện mua bán ngắn hạn các giấy tờ có giá với các ngân
hàng thương mại và các tổ chức tín dụng trên thị trường mở.
8. Ngân hàng Trung ương Anh là đơn vị đầu tiên chính thức thừa nhận sẽ cung cấp các khoản vay
như là phương án cứu cảnh cuối cùng cho các ngân hàng tư nhân nhỏ hơn và kể cả chính phủ.
9. Ngân hàng trung ương thực hiện quản lý nhà nước về tiền tệ và hoạt động ngân hàng nhằm
đảm bảo an toàn và hiệu quả cho hoạt động của hệ thống ngân hàng.
10. Ngân hàng trung ương phải có lượng dự trữ ngoại hối đủ mạnh để can thiệp vào thị trường khi
cần thiết
11. Fed được xem là một ngân hàng trung ương độc lập bởi vì các quyết định chính sách tiền tệ
không cần phải phê chuẩn bởi Tổng thống hoặc bất cứ ai khác trong các ngành hành pháp hay
lập pháp của chính phủ, nó không nhận được kinh phí từ Quốc hội Hoa Kỳ phân bổ theo chính
sách liên bang hằng năm.
12. Ngân hàng trung ương ương thực hiện việc kiểm soát và điều phối nguồn cung tiền tệ của một
quốc gia thông qua cách phát hành tiền tệ và ấn định lãi suất cho các khoản vay trái phiếu.
13. Ngân hàng trung ương cũng đóng vai trò là "người chủ" cho vay khẩn cấp đối với các ngân
hàng thương mại đang gặp khó khăn và các tổ chức khác, và đôi khi là cả chính phủ.

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 14. Ngân hàng trung ương Napoleon của Pháp và Ngân hàng trung ương Reichsbank của Đức, lại
được thành lập với mục đích tài trợ cho các hoạt động quân sự tốn kém của chính phủ
15. Ngân hàng Trung ương cấp tín dụng cho ngân hàng và các tổ chức tín dụng nhằm đảm bảo cho
nền kinh tế đủ phương tiện thanh toán cần thiết trong từng thời kỳ
16. Giấy bạc ngân hàng do Ngân hàng Trung ương phát hành là phương tiện thanh toán hợp pháp,
làm phương tiện lưu trữ thông tin và phương tiện thanh toán.
17. Ngân hàng Trung ương thay mặt cho Nhà nước trong quan hệ nước ngoài trên lĩnh vực tiền tệ,
tín dụng, ngân hàng.
18. Ngân hàng trung ương quản lý dự trữ hối đoái và chính sách hối đoái.
19. Ngân hàng Trung ương có vị trí đặc thù trong bộ máy quản lý máy và điều hành vĩ mô của Nhà
nước.
20. Ngân hàng Trung ương thực hiện chức năng quản lý không đơn thuần bằng các luật, các biện
pháp hành chính, mà còn thông qua các nghiệp vụ mang tính kinh doanh sinh lời.

V. Read the passage and answer the questions

You are going to read a passage about the monetary policy. Answer the questions below.
At the Bank of England, in common with most central banks round the world now, when we look at
monetary policy, it involves changing interest rates. The aim of monetary policy is to keep inflation low
and stable. When you're setting interest rates, what you're trying to do is to keep demand in the
economy, what people consume, how much they invest, in line with the long-term ability of an economy
to supply goods and services through labor, through people employed, and through the capital
employed, machinery, plant and equipment in the economy.

When interest rates rise, this will mean that individuals will tend to save more and consume less. Also
for companies, investment decisions are more expensive and that means that demand will tend to be
reduced. When interest rates are cut, the opposite happens – people will spend rather than save and
companies have more of an incentive to invest, and that means that the level of demand rises. And it's
by trying to set demand, to keep demand in line with supply in future, so that the central bank is always
looking ahead. When the central bank sets the base rate for lending to commercial banks, it affects the
whole structure of interest rates in a country.

For example, in the United Kingdom one of the things it affects very quickly is the rate at which the
banks and other organizations lend to households for their mortgages, but of course it will also affect the
rates at which companies borrow. Of course that just means that the central bank controls the short-
term interest rate. What happens to other interest rates, one-year, five-year, ten-year interest rates, can
be quite different.
Questions:
1. What is the aim of monetary policy?
………………………………………………………………………………………………………………...
………………………………………………………………………………………………………………...
2. What tools does a central bank use to control supply and demand for money?
………………………………………………………………………………………………………………...
………………………………………………………………………………………………………………...

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 3. What tends to happen when interest rates rise?
………………………………………………………………………………………………………………...
………………………………………………………………………………………………………………...
4. What tends to happen when interest rates fall?
………………………………………………………………………………………………………………...
………………………………………………………………………………………………………………...
5. What do commercial banks do after the central bank changes the base rate at which it lends them
money?
.................................................................................................................................................... ……………
………………………………………………………………………………………………………………...

1. The aim of monetary policy is to keep inflation low and stable.

2. The central bank is setting interest rates, what it trying to do is to keep demand in the economy, what
people consume, how much they invest, in line with the long-term ability of an economy to supply goods
and services through labor, through people employed, and through the capital employed, machinery,
plant and equipment in the economy.
3. When interest rates rise, this will mean that individuals will tend to save more and consume less. Also for
companies, investment decisions are more expensive and that means that demand will tend to be
reduced.
4. When interest rates are cut, the opposite happens – people will spend rather than save and companies
have more of an incentive to invest, and that means that the level of demand rises.
5. When the central bank sets the base rate for lending to commercial banks, it affects the whole structure
of interest rates in a country. It affects very quickly the rate at which the banks and other organizations
lend to households for their mortgages, but of course it will also affect the rates at which companies
borrow.

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