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Chapter 23

Economics 1022A/B Chapter Notes - Chapter 23: Loanable Funds, Financial Institution, Financial Market


Department
Economics
Course Code
ECON 1022A/B
Professor
Jeannie Gillmore
Chapter
23

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      1
Macroeconomics 1022B
Lecture Cycle 4
Chapter 23: Finance, Saving, and Investment
Financial Institutions and Financial Markets
In studying the economics of nancial instuons in markets, we disnguish between:
1.
Finance and Money

 
! "#$%$
$# 
&'$%#
 
-"#$%($$#
$)* 
 
2. Physical Capital and Financial Capital
+,-

% + 
,-
Capital and Investment
.
/)0 
1!-$ 
2-/
0 
Wealth and Saving
'-$ 
-3$/0 
"-
% 
-"$ 
-'$# 4
$# 

Only pages 1-2 are available for preview. Some parts have been intentionally blurred.

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-$)$
$) 
-#15+$$ -
##
 
Financial Capital Markets
"these funds are supplied
and demanded in 3 types of markets:
6 Loan Markets
-78$!
 "# 
-98$#
% -#8
 
-9 -
$
$ 
Bond Markets
-''$
 1 
-74# '
$%$
 
-7&#&#$% 
-&!7#"4$
# 
o&!# -#
#
 -!#

!$ 
: Stock markets
-"#4$; 
-<##;$ 
-"#&##$# 
=>-#2?# 
Financial Institutions
4# -
$#
-$
#$#
$$$ 
The key Canadian nancial instuons are:
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      3
1. Banks
-4
# 
Trust and Loan Companies
-+#$# -
# -
 
: Credit Unions and Caisses Popularies
-7#$$
$ 
@ Pension Funds
-%$# -
A%#
# - 
B Insurance Companies
-+#! -$%
8 
-<#
$ 
-"# -
 
-*$
*$
 -$$*$ $
$C
 
4#$$>)
Insolvency and Illiquidity
2'-#$#
$$ 
-"!;$D+ 
-!;$D 
o4 
oE$/#0
$$
 
") 
-))!$$$
$$ 
)$ 
Interest Rates and Asset Rates
"#! 
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