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9 Cards in this Set

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Balance sheet

Statement of assets and claims on assets that summarizes the financial position of the bank at a certain time

Fractional reserve banking system

Which only a fraction of the total money supply is held in reserve as currency

Vault cash

Cash held by a bank (aka till money)

Required reserves

An amount of funds equal to a specified percentage of the bank's own deposit liabilities

Reserve ratio

The ratio of the required reserves the commercial bank must keep to the bank's own outstanding checkable-deposit liabilities

Excess reserves

Subtracting required reserves from its actual reserves

Actual reserves

Funds that a bank has in deposit at the Federal Reserve Bank of its district (plus its vault cash)

Federal funds rate

Interest rate paid on overnight loans

Monetary multiplier

Multiple of its excess reserves by which the banking system can expand checkable deposits and thus the money supply by making new loans