Macroeconomics
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Questions and Answers

What are the main types of financial institutions in the U.S. economy?

  • Commercial banks, insurance companies, central banks, and mutual funds
  • Investment banks, mutual funds, central banks, and credit unions
  • Commercial banks, central banks, pension funds, and hedge funds
  • Commercial banks, credit unions, investment banks, and insurance companies (correct)
  • What are the three kinds of saving in the National Income Accounts?

  • Household saving, business saving, and international saving
  • Individual saving, organizational saving, and global saving
  • Private saving, public saving, and foreign saving (correct)
  • Personal saving, corporate saving, and government saving
  • What is the function of financial institutions in the economy?

  • To help match one person’s saving with another person’s investment (correct)
  • To provide insurance for individuals and businesses
  • To regulate government spending and taxation
  • To control the supply of money in the economy
  • How do government policies affect saving, investment, and the interest rate?

    <p>Government policies can influence the level of saving, the amount of investment, and the interest rate through changes in taxation and spending.</p> Signup and view all the answers

    What's the difference between saving and investment?

    <p>Saving is the act of not spending all of one's income, while investment is the use of saved funds to earn a financial return.</p> Signup and view all the answers

    How does the financial system coordinate saving and investment?

    <p>By matching one person’s saving with another person’s investment</p> Signup and view all the answers

    What are the main types of financial institutions in the U.S. economy?

    <p>Commercial banks, credit unions, investment banks</p> Signup and view all the answers

    What factors affect the supply and demand for loanable funds in the market?

    <p>Interest rates and government borrowing</p> Signup and view all the answers

    How do government policies affect saving, investment, and the interest rate?

    <p>By implementing fiscal and monetary policies</p> Signup and view all the answers

    What's the relationship between saving and investment in the National Income Accounts?

    <p>They are equal when the economy is in equilibrium</p> Signup and view all the answers

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