ECON 2010 Study Guide - Midterm Guide: Consumption Function, Menu Cost, Monetary Policy
Document Summary
Saving current income minus spending on current needs; (saving rate = saving/income) Wealth value of accumulated assets minus liabilities (todos os bens reunidos) Stock value defined at a point in time (wealth, debt) Flow value defined per unit of time (income, wage, saving) to change; causes the stock of wealth: the flow of savings o, every dollar a person spends/saves adds/subtracts from their wealth; National savings (household savings, business and government savings) Current income minus current spending in needs; s = y c g (private savings + public savings) Private savings households + business savings (after-tax income minus consumption) Business saving is revenues - operating costs - dividends (savings to buy equip) Public savings public sector"s income that is not spent in needs; (income = taxes) Government budget occurs when government spending equals net tax receipts; Government budget surplus = excess of tax collection. Government budget deficit = excess of spending (public dissavings)
