Term
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Definition
| anything generally accepted in exchange for goods or services |
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Term
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Definition
| the primary function of money, which is to facilitate transactions and lower transaction costs |
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Term
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Definition
| direct exchange of goods and services without the use of money |
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Term
| Means of Deferred Payment (501) |
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Definition
| The attribute of money that makes it easier to borrow and repay loans |
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Term
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Definition
| Coins and/or paper created to facilitate the trade of goods and services and the payment of debts |
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Term
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Definition
| Coins and paper officially declared to be acceptable for the settlement of financial debts |
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Term
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Definition
| A means of exchange established by government declaration |
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Term
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Definition
| balances in bank accounts that depositors can acces on demand |
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Term
| Transaction deposits (503) |
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Definition
| deposits that can be easily converted to currency or used to buy goods and services directly |
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Term
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Definition
| Transaction instruments easily convertaible into currency |
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Term
| Nontransaction Deposits (504) |
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Definition
| funds that cannot be used for payment directly but must be converted into currency for general use |
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Term
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Definition
| Nontransaction deposits that are not money but can be quickly converted into money |
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Term
| Money Market Mutual Funds (504) |
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Definition
| Interest-earning accounts provided by brokers that pool funds into such investments as Treasury bills |
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Term
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Definition
| the ease with which one asset can be converted into another asset or into goods and services |
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Term
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Definition
| the narrowest definition of money: includes currency, checkable deposits, and traveler's checks |
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Term
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Definition
| a broader definition of money that includes M1 plus saving deposits, time deposits, and noninstitutional money market mutual fund shares |
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Term
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Definition
| defining the dollar as equivalent to a set value of a quantity of gold, allowing direct convertibility from currency to gold |
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Term
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Definition
| the principle that "cheap money drives out dear money", given an alternative, people prefer to spend less valuable money |
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Term
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Definition
| financial institutions organized to handle everyday finiancial transactions of business and households through demand deposit accounts and savings accounts and by making short-term commericial consumer loans |
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Term
| Savings and Loan Associations (508) |
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Definition
| Financial insititutions organized as cooperative associations that hold demand deposits and savings of members in the form of dividend-bearing shares and make loans, especially home mortgage loans |
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Term
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Definition
| Financial cooperatives made up of depositors with a common affiliation |
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Term
| Reserve Requirements (509) |
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Definition
| holdings of assets at the bank or at the Federal Reserve Bank as mandated by the Fed |
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Term
| Fractional Reserve System (509) |
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Definition
| a system that requires banks to hold reserves equal to some fraction of their checkable deposits |
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Term
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Definition
| Highly liquid, interest-paying assets held by the bank |
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Term
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Definition
| a financial record that indicates the balance between a bank's assets and its liabilities plus capital |
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Term
| Requires Reserves Ratio (511) |
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Definition
| The percentage of deposits that a bank must hold at the Federal Reserve Bank or in bank vaults |
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Term
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Definition
| Reserves levels held above that required by the Fed |
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Term
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Definition
| Measures the potential amount of money that the banking system generates with each dollar of reserve |
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