chapter 8 capital Flashcards
(8 cards)
1
Q
what is capital
A
durable items that are used as productive input for other productions
2
Q
two types of capital
A
- tangible
- intangible
3
Q
assets beside of capital
A
financial assets
4
Q
types of financial assets
A
pieces of paper: mortgage, or bonds
electronic records: accounts in bank
5
Q
how do banks act as intermediaries
A
they accept savings from depositors and channel them to borrowers
6
Q
factors influencing interest rate
A
- maturity
- level of risk
- liquidity of asset
7
Q
how to calculate return on investment
A
income/initial investment
8
Q
how to calculate pv
A
fv/ (1+i)^n
