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Differentiate between a leader and a manager.

Differentiate between a leader and a manager. Answer: Managers are people who do things right and leaders are people who do the right thing.

Describe how leadership is a special form of human communication.

Describe how leadership is a special form of human communication. Leadership is about: - who you are - how you act - what you do - how you work with others

Identify the five basic components of human communication.

Identify the five basic components of human communication. 1. Communication is not a thing, it is a process. 2. Communication is not linear, it is circular. 3. Communication is complex. 4. Communication is irreversible. 5. Communication involves the total personality.

If you can't or won't wait the entire lag between the youngest and oldest ages in which you're interested?

If you can't or won't wait the entire lag between the youngest and oldest ages in which you're interested? Answer: You can run a staggered hybrid design, instead. This design has lots of smaller lags embedded inside it, but with many overlapping specific ages, so that you can conduct lots of double-hybrid-like tests. If all of these tests show no evidence of cohort or time-frame effects, then you can safely compare the "youngest" data to the "oldest" data to get the desired difference. In this way, you can compare, for example, 30 year-olds to 55 year-olds in a study that only takes 5 years to run and has "defenses" against the two main threats to aging research.

What are The standard solution to the threats posed by cohort and time-frame effects?

What are The standard solution to the threats posed by cohort and time-frame effects? Answer: Use a Hybrid design. The logic of this approach is that the odds of the two different threats producing the same difference in the data is vanishingly small, so if you find the same difference in both types of comparison, you can safely conclude that the difference was caused by the difference in age (and not one of the confounds). Note that there are three specific versions of the hybrid experiment, with fanciest, double hybrid, being worth the extra effort.

Under what conditions can you safely ignore these threats?

Under what conditions can you safely ignore these threats? Answer: When you are studying the effects of aging over very short time-lags (10 yrs), such as a few years or less, then you really don't have to worry about either cohort or time-frame effects.

What is the threats to the internal validity of longitudinal design?

What is the threats to the internal validity of longitudinal design? Answer: Conversely, only one group of subjects is used in a longitudinal study, but order cannot be counter- balanced, and the world "gets older" at the same time as the subjects, so any difference in behavior across ages might be due to the changes in the world, instead, which is known as a time-frame or zeitgeist effect.

What is the threats to the internal validity of Cross-sectional design?

What is the threats to the internal validity of Cross-sectional design? Answer: The groups of subjects in a cross-sectional study are currently different ages, so they must have been born at different times. This means that they are members of different cohorts and, so, maybe any difference in their behavior right now is due to a difference between cohorts, instead of a difference due to current age.

The trick used to deal with the confounds 1-the cohort effect and 2- the zeitgeist effect is.

The trick used to deal with the confounds 1-the cohort effect and 2- the zeitgeist effect is. Answer: Employ both approaches at the same time. If you find the same results in both cross-sectional and longitudinal research, then the odds of those results both being caused by their own unique confound is very low. For example, if the chance that what is found in a cross-sectional study is really caused by a cohort effect, instead of aging, is about 10%, and the chance that what is found in a longitudinal study is really caused by a time-frame effect, instead of aging, is also about 10%, then the chance of getting the same set of results using both methods could be as low as 1%, which is far below the cut-off for chance (5%) that was allow in psychology. On the other hand, if you don't get the same results using both methods, then you must be very very cautious as to how you interpret the results. If nothing else, you'll need to figure out which - if either - of the patter

In general, what's the first and most important thing to check before agreeing that a certain set of data should be treated as a quasi-experiment?

In general, what's the first and most important thing to check before agreeing that a certain set of data should be treated as a quasi-experiment? Answer: The most important question is whether the subject variable is really more stable than the data variable. This must be true for the set of data to be treated as a quasi-experiment.

Why is it not OK to divide your subjects in term of good vs bad previous-night-of-sleep and look for a quasi-experimental effect on current mood?

Why is it not OK to divide your subjects in term of good vs bad previous-night-of-sleep and look for a quasi-experimental effect on current mood? Answer: Even though the previous' night sleep occurred before the current mood, there are too many third variables that could cause both to make this a candidate for quasi-experimental analysis (examples: previous-day's-events, including previous-day's-meals and -exercise).

Why is it not OK to divide your subjects in term of high vs low depression and look for a quasi- experimental effect on anxiety?

Why is it not OK to divide your subjects in term of high vs low depression and look for a quasi- experimental effect on anxiety? Answer: Depression is no more stable than anxiety. The reversed-causation explanation is as plausible as what you seem to be interested in.

Why, in general, are quasi-experiment not threatened (any more than "real" experiments) by the third- variable problem?

Why, in general, are quasi-experiment not threatened (any more than "real" experiments) by the third- variable problem? Answer: Like "real" experiments, the interpretation (and internal validity) of all quasi-experiments can be threatened by confounds. On the surface, it might appear that quasi-experiments are in serious trouble because no attempt was made to create equivalent groups. But when you think about it in terms of causation, instead of just confounding, you often find that all of the third variables that could be the real cause of both the subject variable and the data variable are actually aspects of the subject variable, itself.

Why, in general, are quasi-experiments not threatened by the directionality problem?

Why, in general, are quasi-experiments not threatened by the directionality problem? Answer: Like "real" experiments, most quasi-experiments are not open to reversed-causation explanations because (a) the subject variable was caused a long time ago and causation can't go backwards in time, (b) it's very hard for a variable to be more stable than its causes, and (c) most subject variables are random and permanent.

Which is preferred (under what conditions)?

Which is preferred (under what conditions)? Answer: The former is preferred, in general, because it always has equal-sized groups, so it has the best statistics for a given total number of people. But it's only worth the extra effort when the population isn't close to evenly split between levels of the subject variable of interest. Examples: handedness, since left- handers are much less frequent than right-handers.

What are the two ways to run a quasi-experiment (in terms of sampling)?

What are the two ways to run a quasi-experiment (in terms of sampling)? Answer: There are planned quasi-experiments, where you sample equal numbers of people within each level of the subject variable, and there are ex-post-facto quasi-experiments, where you just take one big sample and split the people into groups after-the-fact.

What do quasi-experiments have in common with "real" experiments and how do they differ?

What do quasi-experiments have in common with "real" experiments and how do they differ? Answer: Quasi-experiments are like experiments in two ways: in both cases, you have a labile measure providing the data and, in both cases, you have another variable that you think of as a potential cause of the data variable. (Note: in most cases, the SV in a quasi-experiment is qualitative, just like the IV in most experiments is often qualitative, but this need not be true in all situations, so I wouldn't really include it here.) Quasi-experiments differ from "real" experiments in that the researcher doesn't have complete control over the potential-cause variable.

What is the definition of a quasi-experiment?

What is the definition of a quasi-experiment? Answer: A quasi-experiment is a correlational study with one variable being a very stable "subject" variable and the other variable being a labile "data" variable.

What are the difference between a Quasi-Experiment and "Plain" Correlational Study?

What are the difference between a Quasi-Experiment and "Plain" Correlational Study? Answer: A "plain" correlational study concerns two equally-labile variables, such as depression and anxiety, while a quasi-experiment concerns one very stable variable and one labile variable.

Why does the relative stability of the two variables matter?

Why does the relative stability of the two variables matter? Answer: It matters because it makes certain causal explanations of the entire pattern of data much more or less plausible than others.

What three questions should you ask yourself when trying to decide which approach to take - surveys vs observation - for a given correlational project? How do the answers to these question "push" you towards surveys or observation?

What three questions should you ask yourself when trying to decide which approach to take - surveys vs observation - for a given correlational project? How do the answers to these question "push" you towards surveys or observation? Answer: First ask yourself what you're trying to measure. Surveys are good for unobservable things, such as attitudes, while observation is good for observable behavior. Then ask yourself whether reactivity is a serious threat and whether realism is very important. A "Yes" to either question would push you towards observation. Finally, consider the amount of work that's involved. This might push you back towards surveys.

In terms of the four types of validity, what's the advantage of observational studies over most other methods? In terms of the threats to the various types of validity, same question.

In terms of the four types of validity, what's the advantage of observational studies over most other methods? In terms of the threats to the various types of validity, same question. Answer: Observational work usually has more external validity (or less of a need for external validity) when compared with either experiments or surveys. The reason for this: observational research has very high realism without any reactivity (assuming that you don't get caught).

What is the general rule that limits when and where you can conduct observational studies without the consent of the subjects? What implications does this rule have for each of the two ways of conducting observational studies?

What is the general rule that limits when and where you can conduct observational studies without the consent of the subjects? What implications does this rule have for each of the two ways of conducting observational studies? Answer: The general rule on conducting observational studies without consent is that it may only occur when and where there is no expectation of privacy. Therefore, naturalistic observation can only be done in public places and participant observation can't be done at all (without prior consent).

And what kind(s) of validity is "observer bias" threat to, anyway?

And what kind(s) of validity is "observer bias" threat to, anyway? Answer: Observer bias is mostly a threat to external and construct validity, but can also be a threat to internal validity in that any observed correlation might be coming from the beliefs of the observers, instead of from a causal relationship between the measured variables. In short, while it's considered a "secondary threat" for both types of observational method, it can be devastating when it occurs.

What are the standard ways to fight "observer bias" ?

What are the standard ways to fight "observer bias" ? Answer: The first thing that we do to fight this is to always use multiple observers and make sure that they agree very strongly about what happened; we require an inter- coder reliability of .90 or better (which is the highest required correlation in psych methods). We also use tricks to limit the options of the observers and prevent overload, such as checklists, time-window sampling, and event-triggered sampling.

What (non-standard) type of experimenter bias can occur in all observational studies? What are the standard ways to fight this (new) type of threat?

What (non-standard) type of experimenter bias can occur in all observational studies? What are the standard ways to fight this (new) type of threat? Answer: "observer bias" - when the beliefs and/or expectancies of the observer end up influencing what data the observer records. (Note: this is different from standard experimenter bias, because standard experimenter bias works by changing the behavior of the subjects. In this case, the subjects' behavior doesn't change; rather, what changes is what is being recorded.)

What are the key threats for each of the two ways of conducting an observational study?

What are the key threats for each of the two ways of conducting an observational study? Answer: The key threat to naturalistic observation is reactivity which can be very strong if the subjects notice that the observers are watching; in other words, it is crucial that the observers not be caught. The key threat to participant observation is the standard form of experimenter bias which is hard to avoid when the observers are forced to interact with the subjects.

What are the two ways to conduct an observational study, including their names?

What are the two ways to conduct an observational study, including their names? Answer: You either observe people without getting involved, which is called "naturalistic observation," or you join them and observe them from inside their group, which is called "participant observation."

What are the four standard scale types and what are each used for (most often)?

What are the four standard scale types and what are each used for (most often)? 1. Likert scales have sets of agree/disagree items (usually an odd number of options with a neutral center); a summary (e.g., the mean) of all items is the subject's score. Very reliable, so good for small effects or small samples. 2. Guttman scales have sets of ascending items for (yes/no) agreement; the score for the subject is the highest item that he or she agreed to. Adaptive in a way to reduce demand for "average" behavior, so good for situations with strong "norms" for behavior or "touchy" subjects where continuing to ask questions after the subject says "no" would be bad. 3. Thurstone scales are sets of items to (yes/no) check off; the items are pre-rated for value and the subject's score is the sum of values. These often have the best construct validity, so good for situations where a fine distinction (and, therefore, discriminant validity) i

What are the advantages and disadvantages of using open-ended questions? In general, do the advantages or disadvantages predominate?

What are the advantages and disadvantages of using open-ended questions? In general, do the advantages or disadvantages predominate? Answer: The main advantage of open-ended question is that they can follow-up on things that arise during the interview that the researcher didn't think of in advance. The main disadvantage is that open-ended questions are very difficult to codify (i.e., boil down to simple data during pre-processing). This disadvantage is so great that open-ended questions are avoided (unless you're planning to write a pop- psych book, instead of publish in a journal).

Assume that you must choose between a face-to-face survey and a web-based survey. What is the trade- off between threats that you are dealing with and how would that influence your decision as to which method to use?

Assume that you must choose between a face-to-face survey and a web-based survey. What is the trade- off between threats that you are dealing with and how would that influence your decision as to which method to use? Answer: A face-to-face survey will probably have higher experimenter realism (i.e., the subject will take the questions seriously) but it will also evoke higher levels of reactivity (mostly evaluation apprehension) in the subject. So, if the issues being studied are "touchy" (such that subjects would have a better reason to give inaccurate/dishonest answers, go with the web-based study. If it is crucial that the subjects really think about their answers, go with the face-to-face survey.

How do psychologists typically approach the problem of context specificity?

How do psychologists typically approach the problem of context specificity? Answer: Admitting that there's nothing that can be done to fight this. So we study people in the contexts in which we are interested (and avoid generalizing to other contexts). Note that we don't use a variety of contexts in a given study (which would parallel the use of a variety of people). We usually study only one context at a time.

How can non-proportional sampling be used to "correct" for a problem in the accessible population?

How can non-proportional sampling be used to "correct" for a problem in the accessible population? Answer: Assume an accessible population that doesn't match the target population. For example, there are way too many 18-21 year-olds in the Elementary Psych Pool for it to be representative of Iowans (or Americans or humans) in general. You can try to correct for this by purposefully over-sampling people older than 21 from the Elem Psych Pool, to get the sample percents closer to the target values. This is, in a way, a case of two wrongs making a right. Your accessible population was wrong and your method of sampling from it was wrong, but the combination turns out to be closer to right.

What is convenience sampling and what are its advantages and disadvantages?

What is convenience sampling and what are its advantages and disadvantages? Answer: As the name suggests - is getting your subjects from where-ever it is easy. The advantage is that it is easy. The disadvantage is that convenient samples are rarely representative samples of your target population.

What is the main difference between how we approach external validity and how we approached the other three types of validity?

What is the main difference between how we approach external validity and how we approached the other three types of validity? Answer: For the other three types of validity, we identified the threats and attempted to minimize them by doing things like using random assignment, counter-balancing order, validating the measure in advance, and checking to make sure that our data do not violate any (statistical) assumptions. In the case of external validity, we take an almost opposite approach: we attempt to make this type of validity unnecessary by studying the people in which we are interested in the situations in which we are interested.

To test whether a third variable is responsible for an observed correlation.

To test whether a third variable is responsible for an observed correlation. Answer: To test whether your X-Y correlation is spurious - you need to first identify what third variable is. (Note: you're allowed to have more than one third variable and you can test all of your possible third variables in one study.) Then you run a new study in which you measure the third variable(s), together with the original two variables, and conduct a covariance analysis (which removes any part of the target relationship that can be explained by the covariates). The new correlation between X & Y is now called a "partial correlation (with respect to the covariates)." If the partial correlation is just as strong as the original, then the third variable(s) did not cause the X-Y correlation. If the partial correlation is zero, the original X-Y correlation was spurious. Anything in the middle is a mix of the two.

How, in general, do you determine whether X causes Y or Y causes X?

How, in general, do you determine whether X causes Y or Y causes X? Answer: You run a cross-lagged study. You measure both variables at two (or more) points of time, using the same subjects at both times so that you now have (at least) two pairs of X & Y for every subject. If X is the cause of Y, then the correlation between X-at- time-1 and Y-at-time-2 (hereafter: X1-Y2) will be stronger than the correlation between Y-at-time-1 and X-at-time-2 (Y1-X2). On the other hand, if Y is the cause of X, then the Y1-X2 correlation will be stronger than the X1-Y2 correlation. In general, because we think that causation always happens forward in time, the cause should be measured before the effect to get the best correlation.

Now assume that the particular cause-and-effect relationship that you are interested in is X causes Y. What are the names for the other two possibilities?

Now assume that the particular cause-and-effect relationship that you are interested in is X causes Y. What are the names for the other two possibilities? Answer: If you are interested in whether X causes Y, then the possibility that Y causes X, instead (aka "reversed causation"), illustrates the "directionality problem" and the possibility that Z causes both X & Y illustrates the "third-variable problem."

Assume that you have found a significant correlation between X and Y. What are the three possible explanations for this?

Assume that you have found a significant correlation between X and Y. What are the three possible explanations for this? Answer: A correlation between X & Y can be explained as: (1) X causes Y, (2) Y causes X, or (3) Z causes both X & Y.

What difference in labeling do we use to keep the above difference between experiments and correlational studies clear.

What difference in labeling do we use to keep the above difference between experiments and correlational studies clear. Answer: The manipulated variable in an experiment is called the "IV." The measured variable in an experiment is called the "DV." Both variables in a correlational study are measured, so we name them in terms what we think they are doing, instead of what they are. The cause (of the other) is called the "predictor variable" and the effect (of the other) is called the "predicted variable."

The fed promotes secrecy by not releasing FOMC minutes to the congress or the public immediately. Discuss the pro's and con's.

The fed promotes secrecy by not releasing FOMC minutes to the congress or the public immediately. Discuss the pro's and con's. Answer: The argument for not releasing the FOM Cdirectives immediately is that it keeps congress off the fed's back, thus enabling the Fed to pursue an independent monetary policy that is less subject to inflation and political business cycles. The argument for releasing the directive immediately is that it would make the fed more accountable.

The independence of the Fed leaves it completely unaccountable for its actions. Is this statement true false or unceratin.?

The independence of the Fed leaves it completely unaccountable for its actions. Is this statement true false or unceratin.? Answer: False the Fed is still subject to political pressure because congress can pass legislation limiting the Feds power. If the fed is performing badly, congress can therefore make the fed accountable by passing legislation that the fed does not like.

Why might eliminating the Fed's independence lead to a more pronounced political business cycle?

Why might eliminating the Fed's independence lead to a more pronounced political business cycle? Answer: Eliminating the Fed's independence might make it more shortsighted and subject to political influence. Thus, when political gains could be achieved by expansionary policy before an election, the Fed might be more likely to engage in this activity, As a result more pronounced political business cycles might result.

The fed is the most independent of all US government agencies. What is the main difference between it and other government agencies that explains its greater independence.

The fed is the most independent of all US government agencies. What is the main difference between it and other government agencies that explains its greater independence. Answer: The fed is more independent because its substantial revenue from securities and discount loans allows it to control its own budget.

Which entities in the federal Reserve system control the discount rate? Reserve requirements? Open market operations?

Which entities in the federal Reserve system control the discount rate? Reserve requirements? Open market operations? Answer: The board of governors sets reserve requirements and the discount rate, the FOMC directs open market operations. In practice however the FOMC helps make decisions about reserve requirements and the discount rate.

In what ways can the regional federal reserve banks influence the conduct of monetary policy?

In what ways can the regional federal reserve banks influence the conduct of monetary policy? Answer: The federal reserve banks influence the conduct of monetary policy through their administration of the discount facilities at each bank and by having five of their presidents sit on the FOMC, the main policy making arm of the fed.

The federal reserve system resembles the U.S. constitution in that it was designed with many checks and balances?

The federal reserve system resembles the U.S. constitution in that it was designed with many checks and balances? Answer: Like the US constitution, the federal reserve system, originally established by the federal reserve act, has many checks and balances and is a peculiarly american institution. The ability of the 12 regional banks to affect discount policy was viewed as a check on the centralized power of the board of Governors, just as states rights are a check on the centralized power of the federal government. The provision that there be three types of directors, (A, B, and C) representing different groups was again intended to prevent any group from dominating the fed. The Fed's independence of the federal government and the setting up of the federal reserve banks as incorporated institutions were further intended to restrict government power over the banking industry.

What political realities might explain why the federal reserve act of 1913 placed two federal banks in Missouri?

What political realities might explain why the federal reserve act of 1913 placed two federal banks in Missouri? Answer: The placement of two banks in the Midwest farm belt might have been engineered to placate farmers an important voting block in the early twentieth century.

Why was the federal reserve system set up with 12 regional federal reserve banks rather than one central bank, as in other countries?

Why was the federal reserve system set up with 12 regional federal reserve banks rather than one central bank, as in other countries? Answer: Because of traditional American hostility to a central bank and centralized authority, the system of 12 regional banks was set up to diffuse power along regional lines.

The benefits of using FED discount operations to prevent bank panics are straightforward. What are the costs?

The benefits of using FED discount operations to prevent bank panics are straightforward. What are the costs? Answer: The costs are that banks that deserve to go out of business because of poor management may survive because of fed discounting to prevent panics. This might lead to an inefficient banking system with many poorly run banks.

Discounting is no longer needed because the presence of the FDIC eliminates the possibility of bank panics. Is this statement true, false, or uncertain?

Discounting is no longer needed because the presence of the FDIC eliminates the possibility of bank panics. Is this statement true, false, or uncertain? Answer: False, the FDIC would not be effective in elimating bank panics without Fed discounting to troubled banks in order to keep bank failures from spreading.

Which goals of the fed frequently conflict?

Which goals of the fed frequently conflict? Answer: The goal of price stability often conflicts with the goal of high econmic growth and employment and interest rate stability. When the economy is expanding along with employment, inflation may rise. In order to pursue the goal of price stability the fed may have to pursue contractionary anti-inflationary policy that conflicts with the goal of high employment and economic growth. Similarly when the central bank wants to pursue tight monetary policy and raise interest rates in order to contain inflation, this pursuit of the goal of price stability may conflict with the goal of interest rate stability.

Unemployment is a bad thing, and the government should make every effort to eliminate it. Do you agree or disagree?

Unemployment is a bad thing, and the government should make every effort to eliminate it. Do you agree or disagree? Answer: Disagree. Some unemployment is beneficial to the economy because the availability of the vacant jobs makes it more likely that a worker will find the right job and that the employer will find the right worker for the job.

Describe the two ways whereby capital market securities pass from the issuer to the public.

Describe the two ways whereby capital market securities pass from the issuer to the public. Answer: Capital market securities may be sold in a public offering or in a private placement. In a public offering, investment bankers register the security with the SEC and market it through a network of brokerage houses. In a private placement, the firm or an investment banker sells the securities to a very limited number of investors, who each buy a large quantity.

What is the document called that lists the terms of a bond?

What is the document called that lists the terms of a bond? Answer: The list of terms of a bond is known as the indenture.

What is a sinking fund? Do investors like bonds that contain this feature?

What is a sinking fund? Do investors like bonds that contain this feature? Answer: A sinking fund contains funds set aside by the issuer of a bond to pay for the redemption of the bond when it matures. Because a sinking fund increases the likelihood that a firm will have the funds to pay off the bonds as required, investors like the feature. As a result, interest rates are lower on securities with sinking funds.

A call provision on a bond allows the issuer to redeem the bond at will. Investors do not like call provisions and so require higher interest on callable bonds. Why do issuers continue to issue callable bonds anyway?

A call provision on a bond allows the issuer to redeem the bond at will. Investors do not like call provisions and so require higher interest on callable bonds. Why do issuers continue to issue callable bonds anyway? Answer: Firms like having the flexibility to adjust their capital structure by paying off debt they no longer need. They also need to pay off debt to remove restrictive covenants. Call provisions permit both these actions at the issuer's discretion.

In addition to treasury securities, some agencies of the government issue bonds. List three such agencies, and state what the funds raised by the bond issues are used for.

In addition to treasury securities, some agencies of the government issue bonds. List three such agencies, and state what the funds raised by the bond issues are used for. Answer: Agencies that issue securities include Ginnie Mae (formerly the Government National Mortgage Association), the federal housing administration, the veterans administration, the federal national mortgage association, and the Student Loan Marketing Association. The first four fund mortgage loans and the last funds college student loans.

As interest rates in the market change over time, the market price of bonds rises and falls. The change in the value of bonds due to changes in interest rates is a risk incurred by bond investors. What is this risk called?

As interest rates in the market change over time, the market price of bonds rises and falls. The change in the value of bonds due to changes in interest rates is a risk incurred by bond investors. What is this risk called? Answer: The risk that a bonds price will change due to changes in the market interest rates is called interest rate risk.

The U.S. treasury issues bills, notes, and bonds. How do these three securities differ?

The U.S. treasury issues bills, notes, and bonds. How do these three securities differ? Answer: Treasury bills mature in less than 1 year, treasury notes mature in 1 to 10 years, and treasury bonds mature in about 10 to 30 years.

A bond provides information about its par value, coupon interest rate, and maturity date. Define each if these.

A bond provides information about its par value, coupon interest rate, and maturity date. Define each if these. Answer: The par value is the amount the issuer will pay the holder when the bond matures. The coupon interest rate is multiplied times the par value to determine the interest payment the issuer must make each year. The maturity date is when the issuer must pay the holder the par value.

Distinguish between the primary market and the secondary market for securities?

Distinguish between the primary market and the secondary market for securities? Answer: The primary market is for securities being issued for the very first time, and the issuer receives the funds paid for the security. The secondary market is for securities that have been issued previously but are being traded among investors.

What are the primary capital market securities, and who are the primary purchasers of these securities?

What are the primary capital market securities, and who are the primary purchasers of these securities? Answer: The primary capital market securities are stocks and bonds. Most of these are purchased by and owned by households.

Contrast investors use of capital markets with their use of money markets.

Contrast investors use of capital markets with their use of money markets. Answer: Investors use capital markets for a long term investment purposes. They use money markets, which have lower yields, primarily for temporary or transaction purposes.

Why are banker's acceptances so popular for international transactions?

Why are banker's acceptances so popular for international transactions? Answer: Banker's acceptances substitute the creditworthiness of a bank for that of a business. When a company sells a product to a company it is unfamiliar with, it often prefers to have the promise of a bank that payment will be made.

Who issues commercial paper and for what purpose?

Who issues commercial paper and for what purpose? Answer: Large businesses with very good credit standings sell commercial paper to raise short-term funds. The most common use of these funds is to extend short-term loans to customers for the purchase of the firm's products.

Does the federal reserve directly set the federal funds interest rate?

Does the federal reserve directly set the federal funds interest rate? Answer: The federal reserve cannot directly set the federal funds rate of interest. It can influence the interest rate by adding funds to or withdrawing reserves from the economy.

Who issues federal funds, and what is the usual purpose of these funds?

Who issues federal funds, and what is the usual purpose of these funds? Answer: Federal funds are sold by banks to other banks. They are used to invest excess reserves and to raise reserves if a bank is short.

Distinguish between competitive bidding and non-competitive bidding for treasury securities.

Distinguish between competitive bidding and non-competitive bidding for treasury securities. Answer: In competitive bidding for securities, buyers submit bids. A noncompetitive bidder accepts the average of the rate paid by the competitive bidders.

Which of the money market securities is the most liquid and considered the most risk-free? Why?

Which of the money market securities is the most liquid and considered the most risk-free? Why? Answer: Treasury bills are usually viewed as the most liquid and least risky of securities because they are backed by the strength of the U.S. government and trade in extremely large volumes.

Why are more funds from property and casualty insurance companies than funds from life insurance companies invested in the money markets?

Why are more funds from property and casualty insurance companies than funds from life insurance companies invested in the money markets? Answer: Life insurance companies can invest for the long term because the timing for their liabilities is known with reasonable accuracy. Property and casualty insurance companies cannot predict the natural disasters that cause large payouts on policies.

What purpose initially motivated Merril Lynch to offer money market mutual funds to its customers?

What purpose initially motivated Merril Lynch to offer money market mutual funds to its customers? Answer: Merril Lynch initially felt that it could better service it's regular customers by making it easier to buy and sell securities from an account held at the brokerage house. The brokerage could offer a market interest rate on these funds by investing them in the money markets.

Why do the businesses use the money markets?

Why do the businesses use the money markets? Answer: Businesses both invest and borrow in the money markets. They borrow to meet short term cash flow needs often by issuing commercial paper. They invest in all types of money market securities as an alternative to holding idle cash balances.

Why does the U.S. government use the money markets?

Why does the U.S. government use the money markets? Answer: The U.S. government sells large numbers of securities in the money markets to support government spending. Over the past several decades, the government has spent more each year than it has received in tax revenues. It makes up the difference by borrowing. Part of what is borrows comes from the money markets.

What was the purpose motivating regulators to impose interest ceilings on bank savings accounts? What impact did this eventually have on the money markets?

What was the purpose motivating regulators to impose interest ceilings on bank savings accounts? What impact did this eventually have on the money markets? Answer: Following the great depression, regulators were primarily concerned with stopping banks from failing. By removing interest-rate competition, bank risk was substantially reduced. The problem with these regulations was that when the market interest rates rose above the established interest rate ceiling, investors withdrew their funds from banks.

Distinguish between a term security and a demand security.

Distinguish between a term security and a demand security. Answer: Term securities have a specific maturity date. Demand securities can be redeemed at any time. A six month certificate of deposit is a term of security. A checking account is a demand security.

Why do banks not eliminate the need for money markets?

Why do banks not eliminate the need for money markets? Answer: Banks have higher costs than the money market owing to the need to maintain reserve requirements. The lower cost structure of the money markets, coupled with the economies of scale resulting from high volume and large denomination securities, allows for higher interest rates for investors.

Is a Treasury bond issued 29 years ago with six months remaining before it matures a money market instrument?

Is a Treasury bond issued 29 years ago with six months remaining before it matures a money market instrument? Answer: Money Market securities have an original maturity of less than one year, so the bond would not be considered a money market security.

What Characteristics define the money markets?

What Characteristics define the money markets? Answer: The Money Markets can be characterized as having securities, that trade in one year or less, are of large denomination, and are very liquid.

A final limitation of using the behavioural approach to explain phobias is that not all phobias follow traumas. Explain.

A final limitation of using the behavioural approach to explain phobias is that not all phobias follow traumas. Explain. Some phobias do follow a bad experience, but some develop without one. Some phobias may come about by social learning: child sees their parent frightened of a phobia and so imitate. Behaviour is reinforced by reducing own anxiety and parent's anxiety. Psychodynamic approach may explain phobias with displacement. Possible that phobias are a result of displacement of anxiety onto something more manageable. Alternative explanations suggest that not all phobias are from classical conditioning.

A weakness of the behavioural approach to explaining phobias is that it is an incomplete explanation. Explain.

A weakness of the behavioural approach to explaining phobias is that it is an incomplete explanation. Explain. Even if we accept classical and operant conditioning are involved in phobias, there's still some aspects that require further explanation. Bounton (2007) points out that evolutionary factors have some significance, but two-process model doesn't mention this. E.g. we easily get phobias of things that were dangerous in our evolutionary past like the dark and snakes. It's adaptive to have these fears. Seligman (1971) called this biological preparedness - innate predisposition to acquire such fears. But, it's much more unlikely to have a fear of cars or guns, even though these are more dangerous to us now. This is presumed to be because they haven't existed for long so we're not biologically prepared to learn fear responses to them. This is a problem for the two-process theory as it shows there's more to learning phobias than simple conditioning.

A limitation is that there may be alternative explanations for avoidance behaviour. Explain.

A limitation is that there may be alternative explanations for avoidance behaviour. Explain. Not all avoidance of phobias is the result of anxiety reduction, at least for more complex phobias like agoraphobia. There's some evidence to suggest that some avoidance behaviour appears to be motivated more by positive feelings of safety. Basically, the motivating factor in not wanting to leave the house is not to avoid the phobic stimulus, but to stick with the factor of safety. This explains why some agoraphobics can leave the house with a trusted person with little anxiety, but cannot leave alone (Buck 2010). This is a problem for the two-process model, which suggests that avoidance is motivated by anxiety reduction.

Why does the behavioural approach in explaining phobias have good explanatory power?

Why does the behavioural approach in explaining phobias have good explanatory power? The two-process model was a step forward in 1960 to Watson and Rayner's classical conditioning. It explained how phobias were maintained over time and this had important implications for therapies because it explained why patients needed to be exposed to their phobia. Once someone is prevented from practising their avoidance behaviour, the behaviour stops being reinforced and so declines. Application to therapy is a strength of the two-process model.

Explain the concept of operant conditioning in terms of phobias.

Explain the concept of operant conditioning in terms of phobias. Positive and negative reinforcement encourage our behaviour. In negative reinforcement, someone avoids a situation that's unpleasant. The behaviour results in a desirable consequence, which means the behaviour will be repeated. Mowrer suggest that when we avoid a phobia, we escape the fear and anxiety that would've occurred if we remained there. The reduction of fear reinforces the avoidance behaviour and so the phobia is maintained.

Phobias are long lasting. Why?

Phobias are long lasting. Why? Mowrer said that responses through classical conditioning would decline over time. But, operant conditioning maintained the phobia.

Explain what stimuli and responses were involved in the case of Little Albert.

Explain what stimuli and responses were involved in the case of Little Albert. The noise was an unconditioned stimuli producing an unconditioned response of fear. The rat, the neutral stimulus, was paired with the noise and so Albert associated them together. The unconditioned stimulus - the rat - now produced a fear response. Albert was now afraid of the rat. The rat became a conditioned stimulus that produced the conditioned response of fear.

Explain the case study of Little Albert.

Explain the case study of Little Albert. Watson and Rayner (1920) created a phobia in 9 month old Albert. He showed no anxiety at the start. When he was showed a white rat, he tried to play with it. However, the experimenters tried to give him a phobia: whenever the white rat was present, they'd make a frightening noise by banging an iron bar close to his ear. The conditioning generalised to similar objects like a non-white rabbit, a fur coat, and Watson dressed as Santa. Albert was distressed at all of these.

Who proposed the two-process model and what exactly is it?

Who proposed the two-process model and what exactly is it? Proposed by Mowrer (1960). The two-process model is based on the behavioural approach to phobias. States that phobias are learnt through classical conditioning but maintained through operant conditioning.

What are the four steps of the Nutrition Care Process? What does each step involve?

What are the four steps of the Nutrition Care Process? What does each step involve? Nutrition Assessment and Reassessment - obtain/collect timely and appropriate data , analyze.interpret with evidence based standards, Nutrition Diagnosis - identify and label problem, determine cause/contributing risk factor, cluster signs and symptoms, Nutrition Intervention - plan nutrition intervention, formulate goals and plan of action, implement nutrition intervention, care is delivered actions are carried out, and Nutrition Monitoring ans Evaluation - monitor progress, measure outcome indicators, evaluate outcomes.