Term
| Double coincidence of wants |
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Definition
| two traders are willing to exchange their products directly |
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Term
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Definition
| anything that is generally accepted in exchange for goods and services |
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Term
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Definition
| anything that facilitates trade by being generally accepted by all parties in payment for goods or services |
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Term
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Definition
| anything that serves as both money and as a commodity; money that has intrinsic value |
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Term
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Definition
| a common unit for measuring the value of each good or service |
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Term
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Definition
| anything that retains its purchasing power over time |
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Term
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Definition
| people tend to trade away inferior money and hoard the best |
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Term
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Definition
| the difference between the face value of money and the cost of supplying it; the "profit" from issuing money |
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Term
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Definition
| money whose face value exceeds its cost of production |
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Term
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Definition
| a written order instructing the bank to pay someone from an amount deposited |
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Term
| Fractional reserve banking system |
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Definition
| bank reserves amount to only a fraction of funds on deposit with the bank |
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Term
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Definition
| originally, pieces of paper promising a specific amount of gold or silver to anyone who presented them to issuing banks for redemption; today, Federal Reserve notes are mere paper money |
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Term
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Definition
| bank notes that exchange for a specific commodity, such as gold |
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Term
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Definition
| money not redeemable for any commodity; its status as money is conferred initially by government decree but eventually by common experience |
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Term
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Definition
| U.S. currency that constitutes a valid and legal offer of payment or debt |
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Term
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Definition
| institutions such as banks, mortgage companies, and finance companies, that serve as go-betweens, borrowing from people who have saved to make loans to others |
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Term
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Definition
| commercial banks and thrift institutions; financial institutions that accept deposits from the public |
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Term
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Definition
| depository institutions that historically made short-term loans primarily to businesses |
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Term
| Thrift institutions, or thrifts |
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Definition
| Savings banks and credit unions; depository institutions that historically lent money to households |
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Term
| Federal Reserve System, or the Fed |
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Definition
| the central bank and monetary authority of the United States |
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Term
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Definition
| funds that banks use to satisfy the cash demands of their customers and the reserve requirements of the Fed; reserves consist of cash held by banks plus deposits at the Fed |
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Term
| Federal Open Market Committee (FOMC) |
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Definition
| The 12-member group that makes decisions about open-market operations - purchases and sale of U.S. government securities by the Fed that affect the money supply and interest rates; consists of the seven Board governors plus five of the 12 presidents of the Reserve Banks |
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Term
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Definition
| purchases and sales of government securities by the Fed in an effort to influence the money supply |
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Term
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Definition
| a collection of short-term interest-earning assets purchased with funds collected from many shareholders |
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Term
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Definition
| a bank's additional offices that carry out banking operations |
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Term
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Definition
| a corporation that owns banks |
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