|Real Money Supply|
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Definition of Real Money Supply
Real Money Supply
money supply expressed in base-year dollars, calculated by dividing the money supply by a price index.
A monetary policy of matching wage and price increases with money supply increases so that the real money supply does not fall and push the economy into recession.
money after-tax rate of return minus the inflation rate.
An option is at-the-money if the strike price of the option is equal to the market price of the
Also called the broker loan rate , the interest rate that banks charge brokers to finance
The amount of securities believed to be available for immediate purchase, that is, in the
money that moves across country borders in response to interest rate differences and that moves
A put option that has a strike price higher than the underlying futures price, or a call option
Composed of currency and coins outside the banking system plus liabilities to the deposit money banks.
Banks that raise most of their funds from the domestic and international money markets, relying less on depositors for funds.
Related: Investment management.
Related: Investment manager.
money markets are for borrowing and lending money for three years or less. The securities in
An account that pays interest based on short-term interest rates.
A mutual fund that invests only in short term securities, such as bankers' acceptances,
The use of borrowing and lending transactions in foreign currencies to lock in the
Money market notes
Publicly traded issues that may be collateralized by mortgages and MBSs.
Money purchase plan
A defined benefit contribution plan in which the participant contributes some part and
Money rate of return
Annual money return as a percentage of asset value.
M1-A: Currency plus demand deposits
In a Treasury auction, the amount by which the par value of the securities offered exceeds that of
A call option is out-of-the-money if the strike price is greater than the market price
Precautionary demand (for money)
The need to meet unexpected or extraordinary contingencies with a
Raw material supply agreement
As used in connection with project financing, an agreement to furnish a
Identifiable assets, such as buildings, equipment, patents, and trademarks, as distinguished from a
Wealth that can be represented in financial terms, such as savings account balances, financial
Real cash flow
A cash flow is expressed in real terms if the current, or date 0, purchasing power of the cash
Real exchange rates
Exchange rates that have been adjusted for the inflation differential between two countries.
Real interest rate
The rate of interest excluding the effect of inflation; that is, the rate that is earned in terms
The bid and offer prices at which a dealer could do "size." Quotes in the brokers market may
A real time stock or bond quote is one that states a security's most recent offer to sell or bid (buy).
Realized compound yield
Yield assuming that coupon payments are invested at the going market interest
The return that is actually earned over a given time period.
REIT (real estate investment trust)
real estate investment trust, which is similar to a closed-end mutual
REMIC (real estate mortgage investment conduit)
A pass-through tax entity that can hold mortgages
Speculative demand (for money)
The need for cash to take advantage of investment opportunities that may arise.
n event that influences production capacity and costs in an economy.
Time value of money
The idea that a dollar today is worth more than a dollar in the future, because the dollar
Transaction demand (for money)
The need to accommodate a firm's expected cash transactions.
New muni bond issues scheduled to come to market within the next 30 days.
A market that specializes in trading short-term, low-risk, very liquid
Real Interest Rate
The rate of interest paid on an investment adjusted for inflation
approximated net realizable value at split-off allocation
a method of allocating joint cost to joint products using a
net realizable value approach
a method of accounting for by-products or scrap that requires that the net realizable value of these products be treated as a reduction in the cost of the primary products; primary product cost may be reduced by decreasing either
net realizable value at split-off allocation
a method of allocating joint cost to joint products that uses, as the proration base, sales value at split-off minus all costs necessary
real microprofit center
a center whose output has a market value
realized value approach
a method of accounting for byproducts or scrap that does not recognize any value for these products until they are sold; the value recognized
the cooperative strategic planning,
Net realizeable value
The expected revenue to be gained from the sale of an item or
Market for short-term financial assets.
Assets used to produce goods and services.
real interest rate
Rate at which the purchasing power of an investment increases.
Options embedded in real assets.
real value of $1
Purchasing power–adjusted value of a dollar.
Total quantity of goods and services supplied.
Aggregate Supply Curve
Combinations of price level and income for which the labor market is in equilibrium. The short-run aggregate supply curve incorporates information and price/wage inflexibilities in the labor market, whereas the long-run aggregate supply curve does not.
A situation in which supply exceeds demand.
Exchange Rate, Real
The nominal exchange rate corrected for price level differences.
See money base.
Interest Rate, Real
Nominal interest rate less expected inflation.
Any item that serves as a medium of exchange, a store of value, and a unit of account. See medium of exchange.
Cash plus deposits of the commercial banks with the central bank.
A financial market in which short-term (maturity of less than a year) debt instruments such as bonds are traded.
Change in the money supply per change in the money base.
Money Rate of Interest
See interest rate, nominal.
Neutrality of Money
The doctrine that the money supply affects only the price level, with no long-run impact on real variables.
Sale of bonds by the government to the central bank.
Quantity Theory of Money
Theory that velocity is constant, and so a change in money supply will change nominal income by the same percentage. Formalized by the equation Mv = PQ.
Measured in base year, or constant, dollars. Contrast with nominal.
Real Business Cycle Theory
Belief that business cycles arise from real shocks to the economy, such as technology advances and natural resource discoveries, and have little to do with monetary policy.
Real Exchange Rate
Exchange rate adjusted for relative price levels.
GDP expressed in base-year dollars, calculated by dividing nominal GDP by a price index.
Income expressed in base-year dollars, calculated by dividing nominal income by a price index.
Real Rate of Interest
See interest rate, real.
Wage expressed in base-year dollars, calculated by dividing the money wage by a price index.
An amount made available for sale, always associated with a given price.
View that incentives to work, save, and invest play an important role in determining economic activity by affecting the supply side of the economy.
Real Actions (Earnings) Management
Involves operational steps and not simply acceleration
Realized Gains and Losses
Increases or decreases in the fair value of an asset or a liability that
Realizable Revenue A revenue transaction where assets received in exchange for goods and
services are readily convertible into known amounts of cash or claims to cash.
A revenue transaction where goods and services are exchanged for cash or
Fiat money is paper currency made legal tender by law or fiat. It is not backed by gold or silver and is not necessarily redeemable in coin. This practice has had widespread use for about the last 70 years. If governments produce too much of it, there is a loss of confidence. Even so, governments print it routinely when they need it. The value of fiat money is dependent upon the performance of the economy of the country which issued it. Canada's currency falls into this category.
This is the process by which "dirty money" generated by criminal activities is converted through legitimate businesses into assets that cannot be easily traced back to their illegal origins.
Financial market in which funds are borrowed or lent for short periods. (The money market is distinguished from the capital market, which is the market for long term funds.)
Net Realizable Value
Selling price of an asset less expenses of bringing the asset into a saleable state and expenses of the sale.
money market fund
A type of mutual fund that invests primarily in short-term debt securities maturing in one year or less. These include treasury bills, bankers’ acceptances, commercial paper, discount notes and guaranteed investment certficates.
A guaranteed form of payment in amounts up to and including $5,000. You might request a money order in order to pay for tuition fees at a university or a college, or for a magazine subscription.
Proposal that the money supply be increased at a steady rate equal approximately to the real rate of growth of the economy. Contrast with discretionary policy.
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