Econ midterm 2 equations

∆wealth =

saving + capital gains - capital losses

Personal Saving =

Income - net taxes - consumption

Wealth =

assets - liabilities

Saving Rate =

(Y - T - C) / (Y - T)

Public Saving =

Government Revenue - Government Spending

Government Deficit =

- (public deficit) = G - T

Supply of Loanable funds or National Saving

Y - C - G (Private Saving + Public Saving)

User cost =

Price of Machine (Interest Rate + Depreciation Rate)

Output =

C + I + G + NX

Investment (National Saving) =

Y - C - G

Government Debt =

Last Years Debt + Interest on Existing Debt + Government Defecit

∆ in debt to GDP ratio = (is debt sustainable)

∆(B/Y) = ((G - T)/Y) + (r - g)(B/Y)_t-1

Real Interest Rate =

Nominal Interest Rate - Inflation Rate

Investment = (Open economy)

Savings - Net Exports

Net Exports =

Savings - Investment

Net Exports + Capital Inflows =

0