ECON103 Study Guide - Midterm Guide: Menu Cost, Potential Output, Improved Water Source
9 Aug 2018
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Chapter 9: savings, interests rates, and the market for loanable funds. What is the loanable funds market: suppose you want to start a business. What are the key components: a sound business idea, a -----, start-up capital/financing, business (and governments) obtain funds/financing for their operations in ---, shark tank: uro club. What is the loanable funds market: the loanable funds market is the market where savers ( ----- ) supply funds for borrower to loan. Key services of the financial system: the loanable funds market, matches --- with savers, provides risk-sharing (spreading funds over different assets, provides ----- (converting investments into cash, provides information (price serve as market signals) Every dollar borrowed requires a dollar saved: borrowing spurs investment, which generates future output (gdp) If someone wants to borrow to buy resources for a business, someone else has to ----
