answersLogoWhite

0


Best Answer

How does capital move in theUS economy?

Capital moves throughout our economy through three- sector economy, which consist of our businesses, our government and our households. The main suppliers of this capital is the household sector, and corporation and the federal government. Our households receives and wages and the transfer of payments from the government and the wages and dividends from corporations. These savings are then transferred into financial intermediaries, in turn make these investments in the capital market with the fund which is received from the household sector. The household sector flows of funds into capital is known as indirect investment which is channeled into financial institutions who are specialized and diverse. The fund flow into banks, mutual saving banks, and credit unions. Secondly, household may purchase mutual funds shares, or invest into some life insurance, or may participate in some type of private pension fund plan of have profit sharing. All of the above mention institutions acts as intermediaries, which in turn helps make the flow of these funds from one sector of the economy to another very efficient and competitive. Without these financial intermediaries, the cost of funds would be much higher and the allocation of funds would not be as efficient to the best users at the lowest possible price would not occur.

User Avatar

Wiki User

14y ago
This answer is:
User Avatar

Add your answer:

Earn +20 pts
Q: How does capital move through the US economy?
Write your answer...
Submit
Still have questions?
magnify glass
imp
Related questions

How did the railways help to industrialize the U.S.?

Railways were the key to everything. It was the key to the success of the US economy. It helped move people, capital goods and merchandise.


What was the major changes in the US economy in the 1990s?

More capital equipment manufacturing


What were the effects of manufacturing and investment capital on the US economy?

dont worry about it


First capital of us and second capital of us?

In 1789 New York City became the nation's first capital. Then in 1790 the capital was relocated to Pennsylvania where it remained for ten years. Once again in 1800 the capital was move to its current location in Washington D.C.


What city was the us first national capital located?

new york city because it was highly populated and had a stable economy


Where would they move the us capital if Washington dc were destroyed?

Dever Colorado, centraly located


How have entrepreneurs contributed to economic growth in the US?

the entrepreneur enhance capital formation through the concentration of firms operating in giving economy. thus increasing employment and prosperity. the maintain the market demands with supply of goods and relative services. there by increasing standard of living and functioning of the economy.


During the 1920 the US economy moved through which phase of the business cycle?

Expansion


What are the Strengths of the US economy?

A strength of the American system is the economy and all the comfort and luxury individuals can enjoy. Another strength is the freedom the American system provides individuals to have, and do what they want.


What is the ticker symbol for Barclays Capital US Aggregate Bond Index?

The ticker symbol for Barclay's Capital US Aggregate Bond Index is BARC. This index is watched for signs of long-term changes in the economy of the United States and is commonly referred to as the AGG.


What can Americans do to influence the economic goals of the nation?

While consumers and producers make most decisions that mold the economy, government has a powerful effect on the US economy in a last four areas, as the government uses a capital system.


What city is called the financial capital of the USA?

New York is the headquarters of the NYSE, AMEX, NASDAQ, NY Mercantile Exchange, many commodity exchanges, and most of the large banks, broker-dealers and investment banks, despite the volume of capital exchanged electronically.