Chapter 10 Flashcards
The direct exchange of one set of goods or services for another
Barter
Anything that serves as a medium of exchange, a unit of account, and a store of value
Money
Something that keeps its value if it is stored rather than used
Store of Value
Coins and paper bills used as money
Currency
Objects that have value because the holder can exchange them for something else of value
Representative Money
Money that has value because the government has ordered that it is an acceptable means to pay debts
Fiat Money
An institution for receiving, keeping, and lending money
Bank
The nation’s central banking
Federal Reserve System
The government agency that insures customer deposits if a bank fails
Fed Deposit Insurance Corp
The ability to be used as, or directly converted to, cash
Liquidity
Market in which money is lent for periods less than a year
Money Market
A specific type of loan that is used to buy real estate
Mortgage
A card entitling its holder to buy goods and services based on the holder’s promise to pay for these goods and services
Credit Card
The price paid for the use of borrowed money, or money earned by deposited funds
Interest
The amount of money borrowed
Principal
