principals-concepts-chap9 - for saving to find the...

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Chapter 9 ECO 2013 Core Principles Cost-Benefit Principle - the chapter uses the cost-benefit principle to explain an individual's decision to save and a firm's decision to employ more capital or invest in new technology. Not-All-Costs-Count-Equally - the chapter applies opportunity cost to look at the cost of investing in new capital. Equilibrium Principle - the chapter applies supply and demand analysis to the market
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Unformatted text preview: for saving to find the equilibrium interest rate. Important Concepts Covered ! Saving and the saving rate ! Wealth ! Assets/liabilities ! Flow versus stock ! Capital gains and losses ! Life-cycle, precautionary, and bequest saving ! National, private, and public saving ! Transfer payments ! Government budget deficits and surpluses ! Crowding out...
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