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?

Government policies can influence the level of saving, the amount of investment, and the interest rate through changes in taxation and spending. (A) Signup and view all the answers

What's the difference between saving and investment?

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. (D) Signup and view all the answers