Lesson 7 Flashcards
CHAPTER 7
REAADY!!!
The word “____” is often encounteres in our daily lives when there are discussions about loan and earnings.
Interest
In economics, interest is used in two ways:
Price of the Credit
Return that capital earns
Is often refereed to as loanable funs
Price of the Credits
____ it is that capital earns as an input in the production process.
Return
_____ are the amounts of money lent out by one individual (lender) to another, called a____.
Loanable Funds
Borrower
The _____ would pay an interest interest rate to the lender for the use of that fund.
Borrower
___ is defined as a payment for the immediate use of money.
Interest
____ affect the level of production of investment goods.
Interest Rates
_______ Is determine by the deman for supply of money available as loanable funds.
Interest Rate
The word “____” is often encounteres in our daily lives when there are discussions about loan and earnings.
Interest
In economics, interest is used in two ways:
Price of the Credit
Return that capital earns
Is often refereed to as loanable funs
Price of the Credits
____ it is that capital earns as an input in the production process.
Return
_____ are the amounts of money lent out by one individual (lender) to another, called a____.
Loanable Funds
Borrower
The _____ would pay an interest interest rate to the lender for the use of that fund.
Borrower
___ is defined as a payment for the immediate use of money.
Interest
____ affects the level of production of investment goods.
Interest Rates
_______ Is determine by the deman for supply of money available as loanable funds.
Interest Rate
____ comprises the demnad for consumption loans, investment loans, and even the government while the _______ comes from people who save or consume less of their incomes.
Demand for loanable funds
Supply of loanable funds
A downward sloping demand curve indicates __ interest rates which mean that borrowing money is quite ___.
Downward
Cheap
When the cost of borrowing is ____, this encourages ____ people to avail of more loans.
Low
More
It is upward sloping since individuals would get ____ reuturn on their money when interest rates are ___, and willing to save more.
Higher Return
high
The ______ shows the point whre supply of loanable funds meets the demand for loanable funds.
The equilibrium interest rate
Is the rate determined by the supply and demans in the market for loanable funds.
Nominal Interest rate
Considered as the simplest type of interest rate, this is the stated rate of a given loan.
Nominal Interest rate
Is the nominal interest rate adjusted for inflation
Real Interest Rate
______ is the pricepaid for the use of land and other natural resources or factors of production that is in fixed supply.
Economic Rent
____ is a surplus of revenue over cost which arises due to differences in the level of usability of the land.
Rent
The supply of land is ____, demand becomes the determinat of rent
perfectly inelastic
2 several determinants that economic rent also relies on productivity:
productiveness of the land
prices of other resources
If you own some property, you can receive rent being its owner. It is only tou right to benefit on the property in a sturcture that will favor you. However, when economic gains are obtained without any benefits to the society, this is called ____
Rent Seeking
Is defined as a retun on entrepreneurial abilities to run a business.
Profit
Profits are divided into 2:
Normal Profits
Economic Profits
___ is a form of nonwage income
Profit
Payment made to entrepreneurs as the retun on their risk taking is called _____
Normal Profits
Supplying entrepreneurship in the market would yield______
Normal Profits
Supplying entrepreneurship in the market would yield______
Normal Profits
Is the entrepreneur’s return above and beyond normal profits
Economic Profit
As entrepreneurs become eafer to receive economic profit, They would like to know _____ since these can provide economic profits.
Market Niches
CHAPTER SUMMARY
READY!
Interest is used in two ways: it can be the ______, which often reffered to a sloanable funds, and the ___ that capital earns as an input in the production process.
Price of credit
return that capital earns
_____are the amount of money lent out by one individual to another, a borrower, for which the latter would pay an interest rate to the lender for the use of said fund.
Loanable Funds
Interest rate is fetermined by the ____ available as loanable funds.
demand for and supply of money
______ is the rate determined by supply and demand in the market for loanable funds.
Nominal Interest Rate
___ is the nominal interest rate adjusted for inflation.
Real Interest Rate
____ is the price paid for the use of land and other natural resources or factors of production that are in fixed supply.
Economic Rent
____ is when economic gains are obtained without any reciprocal benefits to the society.
Rent Seeking
____ is defined as a segment of the market that demans a commodity that is slightly differentiated from other commodities.
Market Niche
