Chapter 22 AP Macroeconomics Vocabulary

	That part of a person's wealth that can be readily used for transactions; also serves a store of value and a unit of account
	Something generally accepted as a means of payment
	Something that will allow purchasing power to be carried from one period to the next
	A standard unit in which prices can be quoted and values of goods can be compared.
	Money in it's physical form: coin and paper money
	An Account at a financial institution on which checks can be written; also called checkable deposit.
	The sum of currency (coin and paper money) and deposits
	The central bank of the united states, which oversees the creation of money in the United States
	A firm that channels funds from savers to investors by accepting deposits and making loans
	The committee, consisting of the seven members of the Board of Governors and the twelve presidents of the Fed district banks, that meets about 8 times per year and makes decisions about the supply of money; only 5 of the presidents vote at any one time.
	Something of value owned by a person or firm.
	Something of value that a person or firm owes to someone else.
	Deposits that commercial banks hold at the Fed.
	The fraction of a bank's deposits that it is required to hold at the Fed.
	The buying or selling of bonds by the central bank.
	The proportion of currency that people in the economy want to hold relative to their deposits; it equals currency divided by deposits.
	Currency plus reserves; the monetary base can be tightly controlled by the Fed.
	The equation relating the price level and Real GDP to the quantity of money and the velocity of money: The quantity of money times its velocity equals the price level times real GDP.
	A measure of how frequently money is turned over in the economy.
	The multiple by which the money supply changes as a result of a change in the monetary base.
	A description of the legal authority of central banks to make decisions on monetary policy with little interference by the government in power.
	A business cycle caused by politicians' use of economic policy to overstimulate the economy just before an election.
	The situation in which policymakers have the incentive to announce one economic policy bu then change the policy after the citizens have acted on the initial, stated policy.
	A relationship between the nominal interest rate ad the quantity of money that people are wiling to hold at any given nominal interest rate.
	The interest Rate that the fed charges commercial banks when they borrow from the Fed.
	Purchases and sales of foreign currency by government in exchange markets with the intention to affect the exchange rate.