The meaning of saving and its role in financial market.

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Answer 1

Question

Chapter 31, Problem 1E

To determine

To explain:

The meaning of saving and its role in financial market.

Expert Solution & Answer

Explanation of Solution

Saving is the income which is not spent out of earnings or income. For example, Mr. P deposits $100 as his savings in the saving account in bank. This is left unspent and is called savings.

Savings done by household are considered an important source for further investment by business and government. Saving gives interest to household which is an earning for them.

Savings play a major role in financial market. There is a flow of income from savers to investment. When an individual saves some amount in bank, bank gives interest on it. Some percentage of saving is kept by bank as reserve, rest amount is lent to investors who demand capital. This is called investment.

Economics Concept Introduction

Savings:

Saving is the income which is not spent out of earnings or income. Savings can be made to become financially stronger.

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16:10 ← BEC 3701 - Assignments-... KWAME NKRUMAH UNIVERSITY TEACHING FOR EXCELLENCE SCHOOL OF BUSINESS STUDIES DEPARTMENT OF ECONOMICS AND FINANCE ADVANCED MICRO-ECONOMICS (BEC 3701) Assignments INSTRUCTIONS: Check instructions below: LTE 1) Let u(q1,q2) = ln q₁ + q2 be the (direct) utility function, where q₁ and q2the two goods. Denote P₁ and P2 as the prices of those two goods and let M be per period money income. Derive each of the following: a) the ordinary or Marshallian demand functions q₁ = d₂ (P₁, P₂, M) for i = 1,2 [3 Marks] b) the compensated or Hicksian demand functions q₁ = h₂ (P₁, P2, M) for i = 1,2 [3 Marks] c) the Indirect Utility Function uº = v(P₁, P2, M) [3 Marks] d) the Expenditure Function E(P1, P2, U°) [3 Marks] e) Draw a diagram of the solution. There should be two graphs, one above the other; the first containing the indifference curves and budget constraint that characterize the solution to the consumer's choice problem; the second characterizing the demand…

Answer 2

Question

Chapter 31, Problem 1E

To determine

To explain:

The meaning of saving and its role in financial market.

Expert Solution & Answer

Explanation of Solution

Saving is the income which is not spent out of earnings or income. For example, Mr. P deposits $100 as his savings in the saving account in bank. This is left unspent and is called savings.

Savings done by household are considered an important source for further investment by business and government. Saving gives interest to household which is an earning for them.

Savings play a major role in financial market. There is a flow of income from savers to investment. When an individual saves some amount in bank, bank gives interest on it. Some percentage of saving is kept by bank as reserve, rest amount is lent to investors who demand capital. This is called investment.

Economics Concept Introduction

Savings:

Saving is the income which is not spent out of earnings or income. Savings can be made to become financially stronger.

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Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 3

Question

Chapter 31, Problem 1E

To determine

To explain:

The meaning of saving and its role in financial market.

Expert Solution & Answer

Explanation of Solution

Saving is the income which is not spent out of earnings or income. For example, Mr. P deposits $100 as his savings in the saving account in bank. This is left unspent and is called savings.

Savings done by household are considered an important source for further investment by business and government. Saving gives interest to household which is an earning for them.

Savings play a major role in financial market. There is a flow of income from savers to investment. When an individual saves some amount in bank, bank gives interest on it. Some percentage of saving is kept by bank as reserve, rest amount is lent to investors who demand capital. This is called investment.

Economics Concept Introduction

Savings:

Saving is the income which is not spent out of earnings or income. Savings can be made to become financially stronger.

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Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Question

Chapter 31, Problem 1E

To determine

To explain:

The meaning of saving and its role in financial market.

Expert Solution & Answer

Explanation of Solution

Saving is the income which is not spent out of earnings or income. For example, Mr. P deposits $100 as his savings in the saving account in bank. This is left unspent and is called savings.

Savings done by household are considered an important source for further investment by business and government. Saving gives interest to household which is an earning for them.

Savings play a major role in financial market. There is a flow of income from savers to investment. When an individual saves some amount in bank, bank gives interest on it. Some percentage of saving is kept by bank as reserve, rest amount is lent to investors who demand capital. This is called investment.

Economics Concept Introduction

Savings:

Saving is the income which is not spent out of earnings or income. Savings can be made to become financially stronger.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 31, Problem 1E

To determine

To explain:

The meaning of saving and its role in financial market.

Expert Solution & Answer

Explanation of Solution

Saving is the income which is not spent out of earnings or income. For example, Mr. P deposits $100 as his savings in the saving account in bank. This is left unspent and is called savings.

Savings done by household are considered an important source for further investment by business and government. Saving gives interest to household which is an earning for them.

Savings play a major role in financial market. There is a flow of income from savers to investment. When an individual saves some amount in bank, bank gives interest on it. Some percentage of saving is kept by bank as reserve, rest amount is lent to investors who demand capital. This is called investment.

Economics Concept Introduction

Savings:

Saving is the income which is not spent out of earnings or income. Savings can be made to become financially stronger.

Answer 6

Chapter 31, Problem 1E

To determine

To explain:

The meaning of saving and its role in financial market.

Expert Solution & Answer

Explanation of Solution

Saving is the income which is not spent out of earnings or income. For example, Mr. P deposits $100 as his savings in the saving account in bank. This is left unspent and is called savings.

Savings done by household are considered an important source for further investment by business and government. Saving gives interest to household which is an earning for them.

Savings play a major role in financial market. There is a flow of income from savers to investment. When an individual saves some amount in bank, bank gives interest on it. Some percentage of saving is kept by bank as reserve, rest amount is lent to investors who demand capital. This is called investment.

Economics Concept Introduction

Savings:

Saving is the income which is not spent out of earnings or income. Savings can be made to become financially stronger.

Answer 7

Chapter 31, Problem 1E

To determine

To explain:

The meaning of saving and its role in financial market.

Answer 8

Expert Solution & Answer

Explanation of Solution

Saving is the income which is not spent out of earnings or income. For example, Mr. P deposits $100 as his savings in the saving account in bank. This is left unspent and is called savings.

Savings done by household are considered an important source for further investment by business and government. Saving gives interest to household which is an earning for them.

Savings play a major role in financial market. There is a flow of income from savers to investment. When an individual saves some amount in bank, bank gives interest on it. Some percentage of saving is kept by bank as reserve, rest amount is lent to investors who demand capital. This is called investment.