Exam 7: Finance, Saving, and Investment

Item Millions of dollars Personal consumption expenditure 80 Government expenditure on goods and services 30 Net taxes 35 Gross private domestic investment 20 Imports of goods and services 10 Exports of goods and services 20 -Use the information in the table above to calculate the value of government saving.

In 2008, Germany had a budget deficit of 37 billion euros. This deficit resulted in

In 2007, Singaporeʹs government ran a budget surplus of $4.5 billion. The budget surplus Loanable funds and the real interest rate.

If the real interest rate rises, people

In 2008, Australia had a government budget surplus of $21.7 billion. This budget surplus shifts the demand for loanable funds curve

If two households have the same disposable income in the current year, the household with the

The Ricardo-Barro effect says that

Other things remaining the same, the greater the expected profit,

A firmʹs decision to invest in a project is based on the

When the real interest rate increases,

Changes in all of the following shift the supply curve of loanable funds EXCEPT

An increase in will shift the supply of loanable funds curve .

Suppose that Country A a small country) has exports of $40 million and imports of $50 million. As a result, Country A will funds from the rest of the world and engage in net foreign

In 2007, Franceʹs GDP totaled $1.9 trillion and in 2006 GDP was $1.8 trillion. The total amount spent on new capital in 2007 was $357 billion and in 2006 was $335 billion . To calculate the amount of net investment in France for these years, you need to know .

If the real interest rate increases from 3 percent to 5 percent,

What is the influence of the expected profit and the real interest rate on the amount of investment firms make?

Net investment equals

-In the above figure, the demand for loanable funds curve is drawn for the average expected profit. If the real interest rate is constant at 6 percent and the expected profit falls, the amount of loanable funds demanded will be

If the governmentʹs budget deficit increases and the Ricardo-Barro effect does not apply,

A decrease in the demand for loanable funds and a leftward shift of the demand for loanable funds curve results from