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Financial Terms | |
Demand Deposit |
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Definition of Demand DepositDemand DepositA bank deposit that can be withdrawn on demand, such as a deposit in a checking account.
Related Terms:Demand depositsChecking accounts that pay no interest and can be withdrawn upon demand. Money supplyM1-A: Currency plus demand deposits Negotiable order of withdrawal (NOW)demand deposits that pay interest. Aggregate DemandTotal quantity of goods and services demanded. Aggregate Demand CurveCombinations of the price level and income for which the goods and services market is in equilibrium, or for which both the goods and services market and the money market are in equilibrium. American Depositary Receipts (ADRs)Certificates issued by a U.S. depositary bank, representing foreign Canadian Deposit Insurance CorporationBetter known as CDIC, this is an organization which insures qualifying deposits and GICs at savings institutions, mainly banks and trust companys, which belong to the CDIC for amounts up to $60,000 and for terms of up to five years. Many types of deposits are not insured, such as mortgage-backed deposits, annuities of duration of more than five years, and mutual funds. ![]() Certificate of deposit (CD)Also called a time deposit, this is a certificate issued by a bank or thrift that Certificate of Deposit (CD)A bank deposit that cannot be withdrawn for a specified period of time. See also term deposit. DemandAn amount desired, in the sense that people are willing and able to pay to obtain this amount. Always associated with a given price. Demand line of creditA bank line of credit that enables a customer to borrow on a daily or on-demand basis. Demand LoanA loan which must be repaid in full on demand. Demand Management PolicyFiscal or monetary policy designed to influence aggregate demand for goods and services. Demand master notesShort-term securities that are repayable immediately upon the holder's demand. Demand-Pull InflationInflation whose initial cause is excess demand rather than cost increases. See also cost-push inflation. Demand shockAn event that affects the demand for goods in services in the economy. ![]() Deposit CreationThe process whereby the banking system transforms a dollar of reserves into several dollars of money supply. Deposit SwitchingCentral bank switching of government deposits between the central bank and commercial banks. Depository transfer check (DTC)Check made out directly by a local bank to a particular firm or person. Depository Trust Company (DTC)DTC is a user-owned securities depository which accepts deposits of Direct DepositThe direct transfer of payroll funds from the company bank account direct depositA system where funds are electronically credited to your account by a financial institution or a payroll service. For example, you can arrange with your employer to have your pay cheques automatically deposited into your no fee bank account. Electronic depository transfersThe transfer of funds between bank accounts through the Automated Eurocurrency depositA short-term fixed rate time deposit denominated in a currency other than the local Excess DemandA situation in which demand exceeds supply. Federal Deposit Insurance Corporation (FDIC)A federal institution that insures bank deposits. Hedging demandsdemands for securities to hedge particular sources of consumption risk, beyond the usual International Depository Receipt (IDR)A receipt issued by a bank as evidence of ownership of one or more MBS DepositoryA book-entry depository for GNMA securities. The depository was initially operated by Money market demand accountAn account that pays interest based on short-term interest rates. Multiple Deposit CreationThe process whereby the money multiplier operates. Negotiated certificate of depositA large-denomination CD, generally $1MM or more, that can be sold but Notice DepositSee term deposit. pre-authorized direct depositA system where funds are electronically credited to your account by a financial institution or a payroll service. Precautionary demand (for money)The need to meet unexpected or extraordinary contingencies with a Savings depositsAccounts that pay interest, typically at below-market interest rates, that do not have a Security deposit (initial)Synonymous with the term margin. A cash amount of funds that must be deposited Security deposit (maintenance)Related: Maintenance margin security market line (SML). A description of Speculative demand (for money)The need for cash to take advantage of investment opportunities that may arise. Term DepositAn interest-earning bank deposit that cannot be withdrawn without penalty until a specific time. Time depositInterest-bearing deposit at a savings institution that has a specific maturity. Time DepositSee term deposit. Transaction demand (for money)The need to accommodate a firm's expected cash transactions. Variable rated demand bond (VRDB)Floating rate bond that can be sold back periodically to the issuer. Warehouse demandThe demand for a part by an outlying warehouse. Insured Retirement PlanThis is a recently coined phrase describing the concept of using Universal Life Insurance to tax shelter earnings which can be used to generate tax-free income in retirement. The concept has been described by some as "the most effective tax-neutralization strategy that exists in Canada today." Margin callA demand for additional funds because of adverse price movement. Maintenance margin Related to : financial, finance, business, accounting, payroll, inventory, investment, money, inventory control, stock trading, financial advisor, tax advisor, credit. |