In: Economics
1. Macroeconomists refer to investment spending as:
buying shares of Apple stock.
buying newly issued shares of Uber stock.
purchasing physical capital.
saving for retirement.
purchasing a government savings bond.
2. In a closed economy, national savings is the sum of _______ and ______:
the budget balance; private consumption.
private saving; government tax revenue.
private saving; the budget balance.
the budget balance; trade surplus.
3. One difference between a closed and an open economy is that:
in the latter, foreign savings complement domestic savings in financing investment spending.
in the latter, the government is more open to the idea of financing investment spending than in the former.
in the former, foreign savings complement domestic savings in financing investment spending.
in the former, foreign savings finance more investment spending than in the latter.
4. The slope of the demand for loanable funds is:
upward, since it takes a higher rate of return to get more funds.
downward, because more potential projects yield 10% than yield 5%.
upward, because higher rates of return are necessary to cover higher costs.
downward, because demand is higher when the price to borrow money is higher.
downward, because the demand is higher when the price to borrow money is lower.
1. Option 3. It is the money spent on capital goods, or goods used in the production of capital, goods or services
2. Option 3. It is the sum of private saving and public saving
3. Option 1
4. Option 4. As there is a negative relation between the real interest rate and demand for money