Banking Flashcards
Define near money.
Near money describes assets which fulfil the functions of money.
Define legal tender.
Money of the concerned state deemed by law to be an acceptable form of payment.
Define token money.
A form of money where its form has little or no inherent value.
Deform commodity money.
A form of money where the value at which it is exchanged is equal to the value of its metallic contents.
Define fiat money.
Fiat money is bank notes issued that are not backed by the banks holding of precious metals.
Define banks.
Banks are private firms licenses to take deposits and make loans while operating within a country.
Define reserve ratios.
Reserve ratio is the percentage of the bank’s deposits which must be held in cash form.
Define gilt edged security.
A security issued by the government which pays a fixed rate of interest on a regular basis for a specific period of time until the redemption date when capital is returned.
Define money.
Money is anything accepted as a means of payment for goods and services, or for the settlement of debt.
