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9 Cards in this Set
- Front
- Back
fractional reserve banking system
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a reserve requirement that is less than 100 percent of the checkable-deposit liabilities of a commercial bank or thrift institution
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balance sheet
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a statement of assets and claims on assets that summarizes the financial position of the bank at a certain time
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vault cash
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cash held by the bank; till money
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required reserves
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an amount of funds equal to a specified percentage of the bank's own deposit liabilities
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reserve ratio
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the ratio of the required reserves the commercial bank must keep to the bank's own outstanding checkable-deposit liabilities
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excess reserves
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found by subtracting a bank's required reserves from its actual reserves
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actual reserves
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the funds that bank has on deposit at the Federal Reserve Bank of its district (plus its vault cash)
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Federal funds rate
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the interest paid on overnight loans
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monetary multiplier
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the multiple of its excess reserves by which the banking system can expand checkable deposits and thus the money supply by making new loans (or buying securities)
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