ECON 1BB3 Chapter Notes - Chapter 13: Open Market Operation, Money Creation, Money Market Fund
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ECON 1BB3 Full Course Notes
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1bb3 chapter 13 : banking and the money supply. Chequable deposits - bank deposits that allow owner to write cheques to third parties. Money aggregates - measure of the economy"s money supply. M1+ - currency held by nonbanking public, traveller"s cheques and chequable deposits at chartered banks, trust and mortgage loan companies (tmls), and credit unions and caisses populaires ( cucps) M1 - currency held by nonbanking public, traveller"s cheques and chequable deposits at chartered banks. Currency in bank vaults are not counted as money supply, because it is not being used for exchange. Savings deposits - earn interest with no specific maturity date, however, banks allow depositors from saving to chequing account. Time deposits ( certificates of deposit ) - earn a specific fixed rate of interest if held for a specific period, ranging from several months to several years, and premature withdrawals and penalized by forfeiting interest.