Chapter 8 Money

Anything that people accept as payment for goods and services.

• checkable deposits
• store of value
• money
• money multiplier

The primary function of money to be widely accepted in exchange for goods and services

• store of value
• unit of account
• required reserves
• medium of exchange

The function of money to provide a common measurement of value for goods and services

• time deposit
• store of value
• unit of account
• medium of exchange

The function of money to hold value over time

• time deposit
• store of value
• unit of account
• medium of exchange

Money that has market value based on the material from which it is made

• commodity money
• fiat money

Money that is accepted by law, and not because of its tangible value

• commodity money
• fiat money

The total money in financial institutions that can be withdrawn by writing a check

• commodity money
• excess reserves
• checkable deposits
• time deposits

An account with guaranteed interest for a period of time

• fiat money
• excess reserves
• checkable deposits
• time deposit

A banking system in which banks keep only a percentage of their deposits on reserve and lend out the remainder

• required reserves
• fractional reserve banking
• required reserve ratio
• Federal Reserve System

The minimum balance of reserves that the Fed requires a bank to hold on deposit with the Fed

• required reserves
• unit of account
• required reserve ratio
• excess reserves