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7 Cards in this Set
- Front
- Back
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Medium of exchange |
What buyers give to sellers when they want to purchase goods and services |
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Store of value |
Item that can transfer purchasing power from present to future (Currency, if currency becomes unpredictable, then more likely people will move to gold) |
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Fiat money |
No intrinsic value- Paper bills |
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Commodity money |
Has intrinsic value- Cigarettes |
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Fed can alter reserve requirements which affects banks how...? |
Increase in RR= More money held, decrease in money supply Decrease in RR= Less money held, increase in money supply |
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Open market operations |
When the FED buys or sells government bonds |
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Money supply is how much money people can **** around with, reserves are off limits! So if depositors loan $100, with a required 10% reserve ratio, that means the people who deposited still have access to their $100, but NOW there is $90 that can be borrowed by others who need it. So we moved the money supply from $100-$190. |
K |
