ECON 1115 Lecture Notes - Lecture 14: Longrun, Loanable Funds, Mutual Fund
Document Summary
Econ 1115: principles of macroeconomics- lecture 14: saving, investment, and the. Financial markets: financial institutions through which savers can directly provide funds to borrowers. Stock market: a claim to partial ownership in a firm. Financial intermediaries: financial institutions through which savers can indirectly provide funds to borrowers. Mutual funds: an institution that sells shares to the public and uses the proceeds to buy a portfolio of stocks and bonds. Gdp equation: y = c + i + g + nx. Because a closed economy does not engage in international trade, imports and exports are exactly zero. In this case, we can write y = c + i + g. This equation states that gdp is the sum of consumption, investment, and government purchases. Each unit of output sold in a closed economy is consumed, invested, or bought by the government.