Linkage between investment and savings

Assignment Help Business Economics

Reference no: EM13998381

Classical economic theory says there is a linkage between investment and savings. Explain the source of this linkage. What is the argument that says this link is not as strong as classical economists believe? (Hint: Differentiate between the parties that save and those that invest, and their rationale.)

Reference no: EM13998381

Questions Cloud

Combining funds from huge numbers of savers : An intermediary forms combining funds from huge numbers of savers. Each saver derives Happiness(H) from Income(I) according to the function: H= 31I -I^2 If there is competition between intermediaries, and if the cost of intermediation is $.50 per $10..

Who has the absolute advantage in baking bread : Two friends, Rachel and Joey, enjoy baking bread and making apple pie. rachel takes 2 hours to bake a loaf of bread and 1 hour to make a pie. Joey takes 4 hours to bake a loaf of bread and 4 hours to make a pie. Who has the absolute advantage in baki..

Explain connection between happiness or utility function : In general, explain the connection between a Happiness or Utility function that exhibits Diminishing Marginal Utility or Happiness, on the one hand, and risk-aversion, on the other.

Absolute and comparative advantag : If french workers can produce 6 cars per day or 10 pounds of cheese and united states workers can produce 4 cars per day or 4 pounds of cheese who should produce what and why? this is a absolute and comparative advantage kind of question

Linkage between investment and savings : Classical economic theory says there is a linkage between investment and savings. Explain the source of this linkage. What is the argument that says this link is not as strong as classical economists believe? (Hint: Differentiate between the parties ..

About the null hypothesis : Which of the following statements is NOT a null hypothesis? Jason wanted to study the affect of drinking on test performance. He assigned one group of people to have a beer before writing a test and another group to have a glass of water before writi..

What is the present value of second alternative mentioned : A generous university benefactor has agreed to donate a large amount of money for student scholarships. The money can be provided in one lump sum of $12 million in Year 0 (the current year), or in parts, in which $7 million can be provided at the end..

Low rates of economic growth-high federal budget deficits : In 2013-2014, the nation was struggling with a persistent high level of unemployment, low rates of economic growth, and high federal budget deficits. Explain how solutions to these economic problems conflict with one another. If you were economic dic..

Equivalent to the non-uniform series of royalty payments : Company A owns a patent with 15 years of remaining life. Company B is paying royalties to Company A for a license to the patent. It is estimated that royalty payments for the next 15 years will be $6,000 per year for the first 5 years, $8,000 per yea..

User Account

All Pages