Money and banking
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23 terms
Terms | Definitions |
|---|---|
 medium of exchange | anything that is generally accepted as a standard of value and a measure of wealth in a particular country or region |
| unit of account | a common unit for measuring the value of each good or service |
| store of value | the ability to hold value over time; a necessary property of money |
| liquidity | being in cash or easily convertible to cash |
| M1 | a measure of the money supply |
| federal reserve notes | paper currency issued by the fed that eventually replaced all other types of federal currency |
| token money | coins of regular issue whose face value is greater than their intrinsic value |
| checkable deposits | checking account balances maintained by, and available through, depository banking institutions, commercial banks, and S&L's |
| commercial banks | banks that earn profits, provide savings, checking, and credit services, offer financial services like money orders and deposit boxes |
| thrift institutions | financial institutions that receive most of their funds from the savings of the public; they include savings banks, savings and loan associations, and credit unions |
| near monies | assets, such as deposits in savings accounts that can be withdrawn at any time that almost serves the function of money |
| M2 | a measure of the money supply |
| savings account | a bank account that accumulates interest |
| money market deposit account | an account that pays higher interest than a savings account but requires more money to open |
| time deposits | Are savings expected to remain on deposit in a financial institution for an extended period. |
| money market mutual fund | a fund that pools money from small savers to purchase short -term government and corporate securities |
| legal tender | something used as an official medium of payment |
| federal reserve system | the central bank of the United States |
| board of governors | seven member board heading the federal reserve system; develops policies concerning money, banking and other financial institution practices |
| federal reserve bank | one of 12 regional banks that monitor and act as depositories for banks in their region |
| federal open market committee | 7 Fed governors and a rotating group of 5 Fed regional bank presidents - makes monetary policy decisions - use monetary policy to acheive macroeconomic goals (low inflation, low unemployment, stable ec growth) |
| financial services industry | Providers of monetary asset management services are collectively referred to as this. |
| electronic payments | A payment that is transmitted electronically either over the telephone line, or between Web sites on the Internet. |
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