Flashcards
ECON: 2bi.
Cards in this deck (11)
- 1Define investmentSpending on new capital equipment, inventories and structures, (including household purchases of new housing).
E.g. building a factory or purchasing a tractor. - 2Define savingsEconomy wide disposable income minus consumption purchases.
- 3What is a financial system?Institutions in an economy that help match one person's savings with another person's investment.
- 4What is a financial market?Institutions through which savers can directly provide funds to borrowers.
E.g. share market, bond market. - 5What is a financial intermediary?Financial institutions through which savers can indirectly provide funds to savers
E.g. banks, managed funds - 6What is an example of debt financing? Equity financing?Bond sales
Share sales - 7What is credit risk?The probability that a borrower fails to pay some or even all of the interest or principal - the greater this risk the greater the interest rate.
- 8What is a closed economy?An economy that does not interact with the rest of the world.
Economy-wide investment equals economy-wide savings - 9What is an open economy?Investment can be to a greater or lesser part be funded by savings from overseas
- 10What is National Savings (S)?The national disposable income that remains after paying for consumption and government purchases
- 11Lots of shit missing thats in notes.
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- Business/Economics Flashcards on ECON: 2bi. , created by Theo Lotu-I'iga on 20/10/2020.
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- Theo Lotu-I'iga
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