5/16/2023 0 Comments Near monies definitionIt is charged with overseeing the Federal Reserve Banks and with helping implement monetary policy of the United States. Board of Governors the main governing body of the Federal Reserve System. It is used by participants as a means for borrowing and lending in the short term, with maturities that usually range from overnight to just under a year. Money market where financial instruments with high liquidity and very short maturities are traded. Legal tender any official medium of payment recognized by law that can be used to extinguish a public or private debt, or meet a financial obligation Rate of return (on a project) is the profit earned on the project expressed as a percentage of its cost. Examples of near money are: Savings accounts. Near monies a term used in economics to describe highly liquid assets that can easily be converted into cash. Commercial banks a depository bank that accepts deposits and is covered by deposit insurance. Time deposits a deposit in a bank account that cannot be withdrawn before a set date or for which notice of withdrawal is required. Checkable deposits bank accounts on which people can write checks. Federal reserve note the banknotes currently used in the United States of America. Store of value a means of holding purchasing power over time. Unit of account a measure used to set prices and make economic calculations providing a common measure of the value of goods and services being exchanged. ![]() Medium of exchange Money's most important function an asset that individuals acquire for the purpose of trading for goods and services rather than for their own consumption. Future value the amount to which some current amount of money will grow as interest accumulates over a specified period of time. It is the value to you today of $1 realized one year from now. ![]() Present value (of $1 realized one year from now) $1/(1 1 r) the amount of money you must lend out today in order to have $1 in one year. Bonds a loan in the form of an IOU that pays interest. Stocks a share in the ownership of a company held by a shareholder. Tight- when economy is doing too well or well, used when worried about inflation, decrease money supply, slows economy, fights inflation Loanable funds market a hypothetical market that brings together those who want to lend money and those who want to borrow money. Monetary policy (tight and easy) the central bank's use of changes in the quantity of money or the interest rate to stabilize the economy.Įasy- Controls money supply, used when economy is slumping, increase money supply, stimulates economy, fights unemployment ![]() Money multiplier the ratio of the money supply to the monetary base indicates the total number of dollars created in the banking system by each $1 addition to the monetary base.
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