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Relationship between investment and savings Financial institutions such as banks, mortgage companies, and finance companies serve as intermediaries between those with a surplus versus those

Relationship between investment and savings

Financial institutions such as banks, mortgage companies, and finance companies serve as intermediaries between those with a surplus versus those with a deficit creating a capital injection market.

  1. In detail, what is the function of the financial market and its influence for the injection of capital?
  2. It contrasts the responsibility of the financial system in the demand for investment versus the supply of savings.
  3. Using the concepts of real interest rate and expected rate of return, test the relationship between saving and capital investment.

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