Slide 3 - Example is production of marketable surplus.

Slide 4 Unit of account common unit for measuring value Store of value - Any form of commodity, asset, or money that has value and can be stored and retrieved over time. Slide 5 - Travelers check - is a preprinted, fixed-amount cheque designed to allow the person signing it to make an unconditional payment to someone else as a result of having paid the issuer for that privilege. They were generally used by people on vacation instead of cash as many businesses used to accept traveller's cheques as currency. Demand Deposits - Funds held in an account from which deposited funds can be withdrawn at any time without any advance notice to the depository institution. Slide 7 Time deposit is a money deposit at a banking institution that cannot be withdrawn for a certain "term" or period of time. Under 100,000 deposits Savings deposit - A deposit account held at a bank or other financial institution that provides principal security and a modest interest rate. Money Market Accounts - A savings account that offers the competitive rate of interest (real rate) in exchange for larger-than-normal deposits. Money market mutual fund shares - is an open-ended mutual fund that invests in short-term debt securities Slide 8 Institutional money market- high minimum investment, low expense share classes which are marketed to corporations, governments, or fiduciaries. They are often set up so that money is swept to them overnight from a company's main operating accounts. Repurchase - A form of short-term borrowing for dealers in government securities. The dealer sells the government securities to investors, usually on an overnight basis, and buys them back the following day. Slide 11 Central Bank- the government agency that oversees the banking system and is responsible for the conduct of monetary policy Banks - institutions)the financial intermediaries that accept deposits from individuals and institutions and make loans: commercial banks, savings and loan associations, mutual savings banks, and credit unions Depositorsindividuals and institutions that hold deposits in banks Borrowers from banksindividuals and institutions that borrow from the depository institutions and institutions that issue bonds that are purchased by the depository institutions Slide 14 - Currency in circulation - is the amount of currency in the hands of the public. Reserves Assets of banks but liabilities of the Central Bank Slide 15 A government bond is a bond issued by a national government, generally with a promise to pay periodic interest payments and to repay the face value on the maturity date Discount loan - The Fed can provide reserves to the banking system by making discount loans to banks. An increase in discount loans can also be the source of an increase in the money supply. The interest rate charged banks for these loans is called the discount rate.