Exam 7: Finance, Saving, and Investment

Item Millions of dollars Personal consumption expenditure 80 Government expenditure on goods and services 30 Net taxes 35 Gross private domestic 20 investment Imports of goods and services 10 Exports of goods and services 20 -Use the information in the table above to calculate the value of national saving.

-In the above figure,technological progress that increases the expected profit will

A small country is a net foreign borrower if its real interest rate without foreign borrowing is ________ the world real interest rate.

Technological progress that increases the expected profit shifts the demand for loanable funds curve

The table below shows data for the U.S. Nominal Interest Rate Inflation Rate 2011 5.25 4 2012 5 2 2013 4.5 4.3 Between 2012 and 2013 the real interest rate ________ and caused a ________ the demand for loanable funds curve.

Suppose the real interest rate rises and the quantity of loanable funds increases.These changes could have been the result of

If a bank's net worth is negative,then the bank definitely is

In 2008,Germany had a budget deficit of 37 billion euros. This deficit resulted in

A firm's decision to invest in a project is based on the

-In the above figure,the economy is at point a on the initial demand for loanable funds curve DLF₀.What happens if the real interest rate rises?

The increase in the capital stock equals the amount of

If the government begins to run a larger budget deficits,then assuming there is no Ricardo-Barro effect,the demand for loanable funds ________ and the real interest rate ________.

The demand for loanable funds curve shows that as the ________ interest rate increases,there will be ________ the curve.

Other things remaining the same,the greater the expected profit,

If the real interest rate is below the equilibrium real interest rate,

In 2008,Australia had a government budget surplus of $21.7 billion. This budget surplus shifts the demand for loanable funds curve ________

Due to the recession in 2008,firms decreased their profit expectations. As a result,there was a ________ shift in the ________ loanable funds curve.

In the absence of a Ricardo-Barro effect,a government budget deficit ________ the demand for loanable funds,________ the real interest rate,and ________ investment.

Which of the following have a positive relationship with household saving? I. the real interest rate II. disposable income III. expected future income

The greater a household's ________ the less is its saving.