| Automated clearinghouse (ACH) transaction | The most common form of electronic funds transfers.
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| Check | An instruction to the bank to take funds from one account and transfer them to another.
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| Commodity money | Precious metals or other items with intrinsic value that are used as money.
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| Credit card | A promise by a bank to lend the cardholder money in order to make purchases.
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| Currency | Paper money; dollar bills or euro notes.
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| Currency in the hands of the public | The quantity of dollar bills held by the nonbank public; part of M1.
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| Debit card | A card that provides instructions to the bank to transfer funds from the cardholder's account directly to a merchant's account.
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| Demand deposits | Standard checking accounts that pay no interest; part of M1.
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| Electronic funds transfer (EFT) | Movements of funds directly from one account to another over an electronic network.
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| E-money | Private money, as represented by a claim on the issuer, which is stored on an electronic device,
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| Eurodollars | Dollar-denominated deposits outside the U.S.; eurodollars held by U.S. citizens are part of M3.
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| Fiat money | Currency with no intrinsic value, it has value as a consequence of government decree.
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| Gross domestic product (GDP) | The market value of final goods and services produced in the economy during a year.
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| Inflation | A sustained rise in the general price level; a situation in which the price of everything goes up more or less at the same time.
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| Liquidity | A measure of the ease with which an asset can be turned into a means of payment.
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| M1 | The narrowest monetary aggregate, which measures the most liquid means of payment available: currency, travelers' checks, demand deposits, and other checkable deposits.
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| M2 | The monetary aggregate most commonly used in the United States, it includes M1 plus somewhat less liquid financial instruments: small-denomination time deposits, savings deposits, money-market deposit accounts, and retail money-market mutual fund shares.
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| M3 | The broadest commonly used U.S. monetary aggregate, it includes M2 plus additional less liquid financial instruments: large-denomination time deposits, institutional money-market mutual fund shares, repurchase agreements, and eurodollars.
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| Means of payment | Something that can be used to purchase goods and services; one of the functions of money.
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| Monetary aggregates | Measures of the quantity of money; M1, M2, and M3.
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| Money | An asset that is generally accepted as payment for goods and services or repayment of debt, acts as a unit of account, and serves as a store of value.
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| Money-market deposit accounts | Accounts that pay interest and offer limited check-writing privileges; part of M2.
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| Money-market mutual fund shares | Shares in funds that collect relatively small sums from individuals, pool them together, and invest them in short-term marketable debt issued by large corporations; retail shares are part of M2, shares held by corporations are part of M3.
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| Payments system | The web of arrangements that allow for the exchange of goods and services, as well as assets, among different people.
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| Repurchase agreement (repo) | A short-term collateralized loan in which a security is exchanged for cash, with the agreement that the parties will reverse the transaction on a specific future date, as soon as the next day.
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| Savings deposits | The general term used to describe interestbearing deposits that may have limited withdrawal privileges, but have no expiration date.
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| Store of value | Allows movement of purchasing power into the future; one of the functions of money.
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| Stored-value card | A card that can be used to make purchases after money is transferred from a cardholder's account.
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| Time deposits | Deposits that cannot be withdrawn before a specified date. Small-denomination time deposits are part of M2; large-denomination time deposits are part of M3.
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| Travelers' checks | Issued by travel companies, banks, and credit card companies, they are guaranteed by the issuer and usually work just like cash; part of M1.
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| Units of account | The units (like dollars) used to quote prices and other financial quantities; one of the functions of money.
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| Wealth | The total value of all assets; the net worth of an individual.
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