Self Test Flashcards
On a balance of payments account, what do you call payments going out of the nation? How about those going in?
The ones going out are called debits; the ones going in are called credits.
Debits and credits are respectively marked with what signs?
Debits: - (because it’s going out)
Credits: + (because it’s going in)
What are the economists’ three definitions of money?
M1, M2, and L.
Banks can create money because the _____________________________ deposited in a bank fluctuates very little from day to day. They also create money in the form of loans by using ____________________ as the basis for additional deposits.
amount of money; deposited funds
A financial asset can be created as long as an offsetting financial ________________ is created at the same time.
liability
The ______________ of the United States guarantees bank deposits through the FDIC and various bonds.
government
A _________________ asset offers a higher rate of return but is less liquid and takes more than one year to mature.
capital market
A ________________ is a loan secured by real estate.
mortgage
An S&L is a ________________________ institution.
savings and loan
Meaning of EMU
European Monetary Union
Meaning of FDIC
Federal Deposit Insurance Corporation
