Ability to turn an asset into cash rapidly and without loss.
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Unit of Account
Money is used to measure and compare.
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barter economy
A(n) ________ requires the exchange of goods of similar or equal value, which makes it tricky to assign value to goods.
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Legal tender
Is the coin or paper currency which must be accepted in exchange for goods or services by the decree of the government.
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Store of Value
Money is used to accumulate wealth.
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Money
is the most efficient method of exchanging goods and services compared to bartering.
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transaction accounts
The Fed keeps a fraction (10 %) of the funds deposited in ________ as reserves.
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M2
includes everything in M1 plus money deposited in savings and other miscellaneous items.
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Fiat
Money refers to the coins and paper money which have no standing behind them except the act that they are legal tender.
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Monetary base
Is bank reserves plus currency in circulation.
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Credit cards
Are a convenient way to take a miniscule loan form a bank.
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fiat monetary system
A(n) ________ is more flexible in the sense that gold holdings of the government need not increase in order to expand the nations supply of money.
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Medium of exchange
Money used to buy goods and services.
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acceptable method of payment
Money is anything which society deems as a(n) ________ in exchange for a good or service.
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transaction accounts
The ________ are part of the money supply as measured by M1 and M2, meaning that the money supply is increased when banks make loans with their excess reserves.
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demand deposits
Checking accounts are called ________, while savings, loans, credit unions, and such are called other checkable deposits.
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transaction accounts
The money deposited into ________ is part of the money supply.
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Liquidity
ability to turn an asset into cash rapidly and without loss
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Medium of exchange
Money used to buy goods and services
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Unit of Account
Money is used to measure and compare
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Store of Value
Money is used to accumulate wealth
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Monetary base
is bank reserves plus currency in circulation
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Secondary market
the lender need not hold the government security until it matures, at the time the kender may sell the government security to another investor
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Flashcard (42)