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22 Cards in this Set
- Front
- Back
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how do you calculate savings?
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income - spending on needs
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how do you calculate savings rate?
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savings/income
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how do you calculate wealth
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assets - liabilities
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what is the difference between a stock and a flow?
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a flow is defined per unit of time and a stock is a measurement taken at a point in time
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how are stocks and flows related?
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a flow is a rate of change in stocks
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what is a capital gain?
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it is an increase in the value of an existing asset
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what is a capital loss?
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a decrease in the value of an existing asset
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what kind of saving is for:
"retirement or the purchase of a home?" |
life-cycle saving
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what kind of saving is for:
"to protect against unexpected setbacks?" |
precautionary saving
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what kind of saving is for:
"the purpose of leaving an inheritance?" |
bequest saving
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what is a capital gain?
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it is an increase in the value of an existing asset
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what is a capital loss?
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a decrease in the value of an existing asset
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what kind of saving is for:
"retirement or the purchase of a home?" |
life-cycle saving
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what kind of saving is for:
"to protect against unexpected setbacks?" |
precautionary saving
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what kind of saving is for:
"the purpose of leaving an inheritance?" |
bequest saving
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how is the real interest rate related to savings?
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real interest rate is like a reward for saving due to the amount of income they accumlate from interest
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how is national saving measured?
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GDP - consumption expenditure - governmen tpurchases
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in national saving, what is GDP?
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income
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in national saving, what is "spending on current needs?"
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consumption expenditure and government purchases
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what determines the # of loanable funds?
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national savings
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what causes investment aka demand for savings to shift?
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- introduction of new technology causes investment to shift out because marginal product increases and it makes investing more attractive
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what causes the supply of savings to shift?
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- if national savings decrease
ex: private sector saves less or if the government decides to spend more (public savings = T-G), if G goes up and T stays the same, then public savings decrease which decreases national savings |
