Glossary Terms:

You Can BANK on This! (Part 1)

Glossary terms from:
http://www.econedlink.org/e578


Bank

A financial institution that provides various products and services to its customers, including checking and savings accounts, loans and currency exchange.

Banking

The industry involved with conducting financial transactions. Also, conducting business with a bank, e.g., maintaining a checking or savings account or obtaining a loan.

Barter

Trading a good or service directly for another good or service, without using money or credit.

Budget

A spending-and-savings plan, based on estimated income and expenses for an individual or an organization, covering a specific time period.

Characteristics of Money

Characteristics of money include it being durable (both physically and socially), divisible (money can be divided into increments appropriate for the cost of an item), transportable (literally meaning that money must be easy to move), and the ability to regulate the amount of money in a market by making it uncounterfeitable.

Check

A written order to a financial institution directing the financial institution to pay a stated amount of money, as instructed, from the customer's account.

Coins

Government-issued pieces of metal that have value and are used as money.

Credit

The opportunity to borrow money or to receive goods or services in return for a promise to pay later.

Credit Card

A small, specially coded plastic card issued by a bank, business, etc., authorizing the cardholder to purchase goods or services on credit.

Debit Card

A small, specially coded plastic card issued by a bank; allows the cardholder to transfer funds electronically and immediately from his or her checking account, as if the cardholder were writing a check to pay for a purchase.

Debt

Money owed to someone else. Also the state or condition of owing money. Can be individual, corporate or government debt.

Exchange

Trading a good or service for another good or service, or for money.

Goods

Tangible objects that satisfy economic wants.

Interest

Money paid regularly, at a particular rate, for the use of borrowed money.

Lend

To grant someone the use of something, on condition that the object borrowed or its equivalent will be returned (often with interest, in the case of money).

Money

Anything that is generally accepted as final payment for goods and services; serves as a medium of exchange, a store of value and a standard of value. Characteristics of money are portability, stability in value, uniformity, durability and acceptance.

Money Supply

Narrowly defined by economists as currency in the hands of the public plus checking-type deposits; also called M1. Other definitions of the money supply (M2, M3) include various savings deposits, money market deposits and money market mutual fund balances.

Paper Money

Certificates of various denominations generally recognized and accepted as a medium of exchange within a nation and elsewhere. Paper money is issued and backed by national governments or, in the case of the euro, by a group of governments.

Save

To keep money for future use; to divert money from current spending to a savings account or another form of investment.

Saving

Disposable income (income after taxes) minus consumption spending.

Services

Activities performed by people, firms or government agencies to satisfy economic wants.

Spend

Use money now to buy goods and services.

Supply

The amount of a good or service that producers are willing and able to offer for sale at each possible price during a given period of time.

Trade

The exchange of goods and services for money or other goods and services.

Work

Effort applied to achieve a purpose or result, often for pay; skills and knowledge put to use to get something done; employment at a job or in a position; occupation, profession, business, trade, craft, etc.