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The Money Supply on the Graph definitions

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Termini in questo insieme (14)

  • Money Supply Curve
    A vertical line on the money market graph representing a fixed quantity of money set by the central bank, regardless of interest rate.
  • Federal Reserve
    The central authority responsible for determining the total amount of money available to the public through policy actions.
  • M1
    A measure including currency in circulation and checking account deposits, representing the most liquid forms of money.
  • Currency in Circulation
    Physical cash held by the public, not including reserves held by the central bank or in vaults.
  • Checking Account Deposits
    Funds in bank accounts that can be accessed on demand and are included in the most liquid money measures.
  • Open Market Operations
    Central bank activities involving the buying or selling of government securities to adjust the amount of money in the economy.
  • Treasury Securities
    Government-issued debt instruments, such as T-bills, used in monetary policy to influence the money supply.
  • T-bills
    Short-term government securities traded by the central bank to manage liquidity and interest rates.
  • Equilibrium Interest Rate
    The rate at which the quantity of money demanded equals the quantity supplied in the money market.
  • Money Demand Curve
    A downward-sloping line showing the relationship between the interest rate and the quantity of money people want to hold.
  • Quantity of Money
    The total amount of funds available for use by the public, determined by central bank policy.
  • Interest Rate
    The cost of borrowing money, serving as the 'price' in the money market and influenced by monetary policy.
  • Liquidity Preference
    A theory explaining how the supply and demand for money interact to determine the equilibrium interest rate.
  • Monetary Policy
    Central bank strategies, mainly involving open market operations, aimed at influencing economic activity through money supply adjustments.