econ final

Savings account

The dollars that become available when people are staying from consumption

Bonds

Loading money to a corporation, burger government entity for a set period of time and receiving regular interest payments

Certificate of deposit

A document that shows an interest bearing loan has been made to a bank or other financial Institution

Pensions

regular allowance for someone who has worked a certain number of years or reached a certain age

Banks

Offer checking accounts, savings accounts, and certificate of deposits. Also offer products, like credit cards fees for over draft late payments

Credit Union

Nonprofit organizations that likewise, make loans and provide financial services Also meant to circumvent loan sharks.

Insurance companies

Provide financial protection

Premium

Regular payment for insurance, policies, monthly, quarterly or annual payments

Savings account versus a certificate of deposit

money in a CD is locked for a set term versus money in a savings account is easy to deposit and withdraw for a savings account. Interest rates fluctuate with the market. However, in AC D, the interest rates are fixed. Not moving for a savings account. There are no penalties however, for a CD If you withdraw early, you get a penalty. Savings accounts are best used for emergency funds or goals greater than a year and a certificate. Deposit is for specific future, or locking in high.

what’s the difference between credit Union, Banks and life insurance companies and how they serve the financial system

Credit Union are member owned, nonprofit, consumer service. They use deposits for loans for their members. Banks are four profit, shareholder owned corporations. They drive the economy and they take deposits and lend them to a broad base of individuals. Life insurance companies are risk protection institutions. They collect premium and invests in long-term markets.

what is your role in the circular flow of finance?

to receive savings from savers and converte them into loans to borrowers to take assets from borrowers and transport them to dividends and interest for savers

GDP

Turn the value, such as a dollar of all final goods and services produced within a country and a given. Total income nation measure economic well-being, measure of a nations economic growth from one period to the next

Real GDP

The dollar price of a GDP in a base year price used to compare changes in GDP from one year to the next and increase in real GDP is an increase in economic growth

nominal GDP

GDP that is not adjusted for inflation the value of good services in current prices

components of GDP example consumption

The expediter by household, Anna, consumption goods and services includes durables and services

Components of GDP for example investments

The purchase of new Good

components of GDP for example government spending

Purchases of goods and services by all levels of government this excludes transfer payments,

components of GDP for example net exports

X – IM or NX is the value of exports of goods and services minus the value of imports of goods and services

intermediate good

Good and the services that are used for further processing and manufacturing or resell

used goods

part of GDP in the period in which they were produced in during which time they were new goods

Black market or underground production

Illegal drugs, goods services in the underground economy that are not part of the GDP

Financial transactions

Households by financial assets, such as bonds in stocks, they are making loans not buying goods and services

household production

Unpaid work that people do for themselves

transfer payments

Payments from the government, including education, grants, Social Security payments, welfare checks, and unemployment checks

non-components of GDP

does not measure income distribution, measure, non-monetary output or transactions , take into account, desirable, externalities, like leisure or environment, measure social well-being, or correlate to standard of living, but it’s not a measure of standard living

what does GDP tell us about the economy?

The overall size of an economy, it’s growth rate in general health

what are the four components of GDP?

Consumption investment government spending in net wars

what’s the difference between real and nominal GDP?

nominal GDP tracks the dollar value while real GDP tracks the actual volume of production

how is the consumer price index used to calculate inflation

inflation rate equals current CPI minus previous CPI over previous CPI times 100