Banking & Liquidity
A firm that manages money and provides financial support.
What is a bank?
The central bank of the united states
What is the FED
The three functions of money
What is the Medium of exchange, as a store of value, and as a unit of account?
A card issued by banks which is used as an IOU, but must be eventually paid back.
What is a credit card?
The money must be easy to carry.
What is portability?
The bank of the banks of the U.S. Government and the Gatekeeper of the U.S. Economy.
What is the Federal Reserve?
the major policy-making group within the Federal Reserve System.
What is the FOMC
The tax multiplier increases in magnitude when
What is the MPC increases
When a corporation divides the ownership into pieces to sell to investors called “shares”
What is a stock?
The objects used as money must withstand physical wear and tear.
What is Durability
Insures up to $250,000 and serves as insurance for banks.
What is the FDIC
The interest the Fed charges a bank for a loan.
What is the Discount rate?
Which of the following would likely slow a nation's economic growths?
What is the removal of the investment tax credit?
The __________ the risk, the ___________ the return.
What is higher and higher, or lower and lower?
The must be easily divdied into smaller units of value.
What is Divisibility?
Must become a member and is a non-for-profit bank.
What is a credit union?
The buying and selling of government securities by the Fed
What are open-market operations?
If the money supply increases, what happens in the money market?
What is the nominal interest rate falls?
What is a wide range of services such as offer checking and savings accounts, loans, and financial advice.
What are commercial banks?
The money available in limited quantities.
What is a limited supply?
Interest, Fees, and Investments and Securities
What is the way banks make money?
The activities of the Federal Reserve are controlled and coordinated by _____.
What is the Fed's boards of governors?
The comsumption function
What the slope = to the MPC
A retirement account which allows money to grow tax-free.
What is a Roth IRA
The 6 characteristics of money.
Durability, Portability, Divisibility, Uninformity, limited supply, and Acceptability?