Term
| What are two categories of accounts? |
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Definition
| Transaction accounts and Time deposits |
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Term
| What is an example of a demand deposit? |
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Definition
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Term
| What is a basic checking account? |
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Definition
| An account that offers a few simple services for minimal cost. |
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Term
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Definition
| Deposits that are held for or mature at a specific time. |
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Term
| What are saving accounts? |
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Definition
| Saving accounts are the time deposits with which most people are familiar. |
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Term
| What does passbook saving accounts do? |
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Definition
| Help building the banking industry |
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Term
| What is a passbook savings account? |
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Definition
| A ledger of activity that the teller updated when the customer made deposits or withdrawals. |
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Term
| What does savings & passbook accounts allow you to do? |
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Definition
| Make deposits in person, By mail, Electronically, Direct deposit |
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Term
| What are money market deposit accounts (MMDA’s)? |
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Definition
| A higher rate of interest than savings accounts, but they usually require a higher initial deposit to open an account. |
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Term
| What are Certificate of Deposit (CD)? |
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Definition
| Certificate offered by a bank that guarantees payment of a specified interest rate until designated date in the future. |
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Term
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Definition
| The price paid for the use of money |
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Term
| What is interest also known as? |
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Definition
| Expressed as a rate or percentage of the total amount of money in use, and is calculated overtime. |
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Term
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Definition
| The beginning amount of money being used to calculate interest. |
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Term
| What is the basic formula to calculate interest? |
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Definition
| P(principle) x R(rate) x T (time) B |
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Term
| How do you find interest? |
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Definition
| Multiply the principle by the rate, expressed as a percentage, by the time, usually expressed in yrs or part of yrs. |
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Term
| What is the formula for calculating |
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Definition
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Term
| What does each letter stand for? |
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Definition
| F- Future value, P- principle, R- Rate, and N- is the number of intervals. |
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Term
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Definition
| Money includes checks, ledgers transfers, and even credit. |
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Term
| How does reserve requirements impact the flow of money? |
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Definition
| If reserve requirements are high than the money supply contracts (comes back in itself) have less money to lend out. |
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Term
| What is a limitation of reserve requirements? |
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Definition
| The federal reserve can effectively take money out of the economy. |
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Term
| What are one of the ways the fed can influence the money supple and the flow of deposits? |
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Definition
| The fed can out more money in the economy by buying securities, or by creating new money. |
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Term
| What is the discount rate? |
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Definition
| The rate the fed charges banks for loans |
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Term
| What does Account rules do? |
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Definition
| explain characteristics of each type of account. |
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Term
| What is deposite rate schedules? |
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Definition
| list interest rates in effect at the time for various types of accounts. |
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