Barter:
system of exchange in which goods or services are traded directly for other goods or services
Not conducive to commerce
what are 3 functions of money?
- Medium of exchange
-Measure of value - Store of value
Three main components of Canadas money supply:
-Currency
-Demand deposits
-Time deposits
what are demand deposits?
money stored in bank accounts that depositors can withdraw on demand
what are time deposits?
money invested for a specific time
What does M1+ include?
currency outside banks plus personal and non-personal chequable deposits held at chartered banks plus all chequable deposits held at trust and mortgage loan companies, credit unions, and caisses populaires.
what does M1++ include?
everything included in M1+ (gross) plus non-chequable deposits held at chartered banks, trust and mortgage loan companies, credit unions, and caisses populaires.
who is the sole issuer of bank notes in Canada
The Bank of Canada
Open market operations:
: the purchase or sale of Canadian government securities by the Bank of Canada to stimulate or slow down the economy
Overnight rate:
the interest rate that our major financial institutions borrow from each other “overnight”
Banks and financial institutions provide:
Secure place to store money and valuables
Convenient access to money
Access to loans
Business and international services
Financial intermediation: when financial institutions act as intermediaries between lenders and borrowers of funds
what is OFSI?
The Office of the Superintendent of Financial Institutions
what does OFSI do?
regulates federally registered banks, insurers, and trust and loan companies as well as credit unions, fraternal benefit societies, and private pension plans
what does Canada Deposit Insurance Corporation (CDIC) do?
Provides deposit insurance and contributes to the stability of Canada’s financial system
