DSST Money & Banking 121 Questions With Complete Solutions

Fiat Money - ️️Money that isn't tied to reserves such as gold, rather is guaranteed by the government's trustworthiness. Has no intrinsic value. Exists in currency bills form and bank deposits. M1 - ️️The sum of all money held by businesses and individuals (incl. traveler's checks) and checkable deposits. M2 - ️️The category that contains all funds included in M1, as well as savings deposits, small-time deposits, money market funds, and other deposits. M3 - ️️The classification of money that includes M2 as well as long-term repurchase agreements held by banks. Fannie Mae - ️️The mortgage association that mostly buys mortgages from banks to free up capital. Ginnie Mae - ️️The government association that guarantees high-risk mortgages. Freddie Mac - ️️The Corporation that uses global capital markets to provide support for low-cost mortgages. Credit Union - ️️This institution mainly makes consumer loans and accepts savings deposits. Usually owned by a group or employees of a firm. Members basically loan money to one another. Interest are low, usually used for emergencies by its members. Mutual fund - ️️These companies start funds that they sell to investors.