Chapter 13 - Savings,Investment Spending, Financial System - Ch9

Chapter 13 - Savings,Investment Spending, Financial System - Ch9

Info iconThis preview shows pages 1–11. Sign up to view the full content.

View Full Document Right Arrow Icon
Savings, Investment Spending, and the Financial System
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Savings-Investment Spending Identity: Savings and investment spending are always equal for the economy as a whole. Budget Surplus: Government spends less than it collects in taxes. Budget Deficit: Government spends more than it collects in taxes.
Background image of page 2
Budget Balance: The difference between tax revenue and government spending. National Savings: The sum of private savings plus the budget balance (public savings), is the total amount of savings generated within the economy.
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Closed Economy GDP = C + I + G S Private = GDP + TR T C S Government = T TR G NS = S Private + S Government = (GDP + TR T C ) + ( T TR G ) = GDP C G I = NS Investment Spending = National Savings
Background image of page 4
Budget Surplus
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Budget Deficit
Background image of page 6
Open Economy GDP = C + I + G + NX Capital Inflow (KI) = - NX = (IM X) I = S Private + S Government + (IM X) = NS + KI I = NS + KI Investment Spending = National Savings + Capital Inflow in an open economy
Background image of page 7

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Open Economy: U.S. 2003
Background image of page 8
Open Economy: Japan 2003
Background image of page 9

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Market for Loanable Funds L oanable Funds Market: Hypothetical model that examines the market outcome of the demand for funds generated by borrowers and the supply of funds provided by lenders. The interest rate is the price, calculated as a percentage of the amount borrowed, charged by the lender to a borrower for the use of their savings for one year.
Background image of page 10
Image of page 11
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 10/04/2008 for the course MACROECONM 101 taught by Professor Noname during the Spring '08 term at Rutgers.

Page1 / 31

Chapter 13 - Savings,Investment Spending, Financial System - Ch9

This preview shows document pages 1 - 11. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online