Exam 10: Savings, Investment Spending, and the Financial Syst

An amount that would equal a particular future value if deposited today at a specific interest rate is the:

Between 2000 and 2006, there was a housing bubble in the United States. A bubble is:

The demand for loanable funds is _____ sloping because _____ respond to lower interest rates by _____ their quantity demanded of loanable funds.

If interest rates are high, people are willing to forgo consumption and save more, all else equal.

If the price of a share of stock is expected to rise, then demanders will demand more of it today, owners will be less willing to sell it today, and its price will rise today.

All other things unchanged, an increase in demand for loanable funds would MOST likely be caused by a(n):

Which asset is the MOST liquid?

When a bond becomes more attractive as an asset because of a rise in the interest rate:

Student loans, auto loans, and credit card loans are often securitized.

Use the following to answer questions: -(Figure: Loanable Funds Market) Use Figure: Loanable Funds Market. If the interest rate is 8%, people will want to save approximately:

The savings-investment spending identity says that:

Which item is a paper claim that entitles the buyer to future income from the seller? I. a financial asset II) a physical asset III) a liability

Which example is considered to be investing in a physical asset?

Of all types of financial assets, transactions costs are likely to be the lowest for loans.

The demand curve for loanable funds slopes:

Which statement is considered investment spending in macroeconomics?

Bonds with a high risk of default usually:

Economists use _____ as a model to explain how savers and borrowers come together to determine the equilibrium rate of interest.

One difference between a closed and an open economy is that:

Which index tracks the 30 leading companies, such as Microsoft, Walmart, and General Electric?