Written Assignment 3 Macroeconomics

Macroeconomics

|Written Assignment 3 |

|Answer all of the following questions. Title your assignment "Written Assignment 3," unless your mentor directs otherwise. This assignment |

|covers text chapters 13 through 17. |

|What is the role of the financial system? Name and describe two markets that are part of the financial system in the U.S. economy. Name and |

|describe two financial intermediaries. |

|Financial Systems are institutions that help to match a persons savings with anothers investment. |

|The bond market is a certificate of indebtedness that specifies the obligations of the borrower to the holder of the bond. The stock market |

|is a claim to partial ownership in a firm. Financial Intemediaries are banks that take deposits and make loans, and Mutual Funds that sells |

|shares to the public |

| |

|What is the government budget deficit? How does it affect interest rates, investment, and economic growth? |

|The government budget deficit is a shortfall of tax revenue from government spending or an excess of government spending over tax tax |

|revenue. When the government spends more than it recieves in tax revenue the resulting budget deficit lowers national saving. The budget |

|deficit can raise interest rates....