Channelling of funds from savers to spenders important, Finance Basics

Assignment Help:

How is the channelling of funds from savers to spenders very important?

The channelling of funds by savers to spenders is very significant for two purposes:

• One, lender-savers (along with excess of accessible funds) does not often have profitable investment opportunities, whereas borrower-spenders have investment opportunities but lack of funds.

• Second, still for purposes other than investment opportunities into businesses, borrower-spenders may wish for invest into excess of their current income or to adjust the composition of their wealth (understanding of the preferences for recent versus future consumption).


Related Discussions:- Channelling of funds from savers to spenders important

Estimate the coupon rate and promised rate on bond, Petroleo Brasileiro (PB...

Petroleo Brasileiro (PBR) has just issued 1M one year bonds. Each bond hasa face value of1,000 Reais. Owners of the bonds are entitled to receive $R 1000 back at the end of the yea

Agency theory, Agency Theory An agency relationship arises whether on...

Agency Theory An agency relationship arises whether one or more parties identified the principal contracts or hires another identified an agent to perform on his behalf some

Money and banking course, Ask questioSay that a buyer of bonds values good ...

Ask questioSay that a buyer of bonds values good bonds at $500 and values bad bonds at $250. Sellers of both good and bad bonds value them at $350. If the fraction of good sellers

Disadvantage of leasing an asset, Disadvantage of Leasing an Asset A. ...

Disadvantage of Leasing an Asset A. It is a pre-conditional finance as on the needs of asset B. In the long term the lease charges might out-weigh the cost of buying own as

Foreign credit insurance association (fcia), Foreign Credit Insurance Assoc...

Foreign Credit Insurance Association (FCIA) An agent of the Export/Import Bank, FCIA gives exporters with insurance coverage beside both commercial and political risk. The main

Calculate the return on equity, Maghrabi Enclosure follows a moderate curre...

Maghrabi Enclosure follows a moderate current asset investment policy, but it is considering whether to shift to a different strategy.  The firm's annual sales are $500,000; its fi

Creditors payment period ratio, Creditors Payment Period Ratio Credit...

Creditors Payment Period Ratio Creditors payment period =   365/ Creditors turnover                                           = (365 x Average creditors)/Annual credit pu

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd