Banking and Monetary Policy_Butkiewicz_Date_021810

Banking and Monetary Policy_Butkiewicz_Date_021810 -...

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Chapter 2 continued 31: MMDA- money market deposit accounts (6 withdraws per month) 32: after $10000 CD’s become very different, larger CD’s can be sold 33: stock mutual funds- value of shares can go up or down, money market mutual funds- managed to try to keep share price at $1, use money to buy liquid assets, earn interest- pay to shareholders 34: reserve requirement of savings accounts = 0, put $ into “shadow account” to minimize money held in reserve and make more loans. Distorted measure of M1 money 36: conduct of monetary policy is important- decisions made in effort to keep economy prosperous and inflation row (play a role in our economic health); if good decision then happy but if bad them there are problems. European central bank- only responsible for conduct of monetary currency 39: Fed more than doubles the amount of assets owned Chapter 3: - Crashes always follow a bubble 3: time value of money is important 4: compound interest= future value of $1 5: present value in years is what is true for $1 is true for any amount (father you go into the
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