capital market???? Flashcards
1
Q
Flow variable
A
variable that has meaning when attached to time
ie. investment
2
Q
Stock variable
A
Variable that points to a specific point in time
ie. Capital
3
Q
sources of financial capital
A
Government subsidies
retained earnings
loans from bank, investors
Sales from stock
4
Q
Which sources of financial capital are income from households
A
loans from banks, investors
sales from stock
5
Q
labor demand
A
MFCk (today) = MFCk(today)
6
Q
Capital Demand
A
MFCk(today) = MRPk(overtime)
or
MFCk(today)=PV MRPk
7
Q
Present value
A
PV=B/(1+r)^n
8
Q
firm hires capital until:
A
MFCk= sum of MRPk/(1+r)^k
