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The Banking System
Chapter 22
| Term | Definition |
|---|---|
| Barter | The direct exchange of goods and services for other goods and services |
| Credit crunch | A reduction in the availability of loans to businesses and individuals and/or the imposition of more severe conditions on the granting of loans |
| Eurozone | An economic and monetary union of 17 of the 27 EU member states that have adopted the euro as their common currency and sole legal tender (officially called the euro area) |
| Fractionally backed | A currency where more notes are issued than are backed by currency reserves |
| Gold Standard | A situation where a country's currency was fully converted into gold |
| Inter-bank market | The name given to the money market in which banks can borrow or lend among themselves for fixed periods |
| Legal tender | Money that must be accepted if offered in payment for a purchase or in settlement of a debt |
| Monetary policy | The policy of the ECB (and the actions taken by it) that affect the rate of interest,the money supply,the availability of credit and the value of the currency |
| Official external reserves | The country's official holdings of gold,foreign currencies and other reserves held as security against the issue of the euro |
| Plastic money | The term used to describe credit cards,ATM cards and debit cards as alternative payment methods to the use of cash |
| Reserve ratio (primary liquidity ratio or cash ratio) | The percentage of a bank's total deposit liabilities that it must hold in cash form |
| Token money | Coins whose intrinsic (metallic) value is less than their face value |
Created by:
jmartineconomics
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