Term
| Lenders buy bonds and borrowers sell them |
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Definition
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Term
| Other things the same, corporate bonds generally feature higher interest rates than U.S. government bonds |
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Definition
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Term
| Mutual funds are a type of financial intermediary |
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Definition
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Term
| If a share of stock in Dell sells for 70 dollars, the retained earnings per share are 5 dollars, and the dividend per share is 2 dollars. Then the price earnings ratio is 10 |
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Definition
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Term
| In a closed economy, if taxes fall and consumption rises, then private saving must fall |
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Definition
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Term
| To state that national saving is equal to investment, for a closed economy, is to state an accounting identity |
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Definition
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Term
| National saving is equal to Y-T-C |
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Definition
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Term
| Alberta buys a paint sprayer and a lift for her car customizing shop. A macroeconomist would refer to these purchases as investment |
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Definition
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Term
| When an economy's government goes from running a budget deficit to running a budget surplus, the economy's long run growths prospects are improved |
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Definition
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Term
| Other things the same, the higher rate of saving and investment in a country, the higher will be the standard of living in the future |
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Definition
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Term
| If, for an economy imaginary closed economy, investment amounts to $10,000 and the government is running a $2500 deficit, then the private savings must amount to $12500 |
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Definition
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Term
| Other things the same, as the maturity of a bond becomes longer the bond will pay... |
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Definition
| A higher interest rate because it has more risk |
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Term
| Bonds are more likely to have higher interests if they have... |
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Definition
| no tax exemptions and long terms |
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Term
| In 2005 some parts of the country were suffering from a drought. What effects would we expect to this to have on the stock of companies such as John Deere that manufacture farm equipment... |
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Definition
| decrease the demand for existing shares of the stock, causing the price to fall |
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Term
| Borrowers can (and sometimes do) default on their loans when... |
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Definition
| they declare for bankruptcy |
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Term
| Who accepts all of the risk associated with a mutual funds portfolio of stocks and or bonds... |
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Definition
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Term
| If a firm wants to borrow it can... |
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Definition
| supply bonds by selling them |
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Term
| In which of the following cases would it necessarily true that national saving and private saving are equal for a closed economy... |
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Definition
| The governments tax revenue is equal to its expenditures |
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Term
| In a closed economy, national saving is... |
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Definition
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Term
| According to the definitions of private and public saving, Y C and G remained the same, an increase in taxes would... |
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Definition
| Lower private saving and raise public saving |
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Term
| Kathleen is considering expanding her dress shop. If interest rates rise she is... |
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Definition
| less likely to expand. This illustrates why the supply of loanable funds slopes downwards |
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Term
| Other things the same, an increase in the interest rate... |
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Definition
| would decrease the quantity of loanable funds demanded |
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Term
| If the supply of loanable funds shift to the right, then the equilibrium interest rate |
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Definition
| falls and the quantity of loanable funds rises |
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Term
| If Congress increased the tax rate on the interest income, investment... |
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Definition
| and savings would decrease |
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Term
| If government institutes policies that diminish incentives to save, then in the loanable funds market... |
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Definition
| the supply of loanable funds shifts to the left |
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Term
| If Congress instituted an investment tax credit, the equilibrium quantity of loanable funds would... |
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Definition
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Term
| A government budge deficit... |
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Definition
| reduces both public and national saving |
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Term
| If the quantity of loanable funds demanded exceeds the quantity of loanable funds supplied... |
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Definition
| there is a shortage so interest rates will rise |
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Term
| We interpret the meaning of "loanable funds" as the... |
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Definition
| flow of resources available to fund private investment |
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Term
| If Research in Motion Inc. sells a bond it is... |
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Definition
| borrowing directly from the public |
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Term
| According to the definition of private and public savings, If Y C and G remain the same, an increase in taxes would... |
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Definition
| lower private saving and raise public saving |
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