Definition of Financial Terms

1. Definition of Terms
2. Give 2 examples for each term related to the “real world”, how it applies to everyday life.

1. Financial Sector
2. Assets
3. Bonds
4. Stocks
5. Investment
6. Loanable Funds
7. Money
8. Wealth
9. Real Interest Rate
10. Nominal Interest Rate
11. Time Value of Money
12. Expected rate of return
13. Barter
14. Commodity Money
15. Fiat Money
16. Medium of Exchange
17. Unit of Account/Measure of Value
18. Store of Value
19. Money Supply
20. Liquidity
21. M0 Money Supply
22. M1 Money Supply
23. M2 Money Supply
24. Demand Deposits
25. Required Reserves
26. Excess Reserves
27. Balance Sheet
28. Equity
29. Liability
30. Money Multiplier
31. Monetary Policy
32. Discount Rate
33. Money Market
34. Open Market Operations
35. Federal Funds Rate
36. Private Savings
37. Publics Savings
38. National Savings
39. Net Capital Inflow
40. Crowding-Out Effect