Chapter 9 Section Review 1, 2,3
Danery Ferlandy Recinos Barrios 11th Grade
Section 1:
How do people gain security and profits through savings?
●People gain security because by having your money in a bank you will never
lose it because they have insurance.
People gain profits because banks and saving institutions give interest to
people who put their money in their banks in exchange for letting them use
their money wherever they want.
How do liquidity and interest rates influence people’s choices between savings
accounts and time deposits?
●People that have money to spare will take the decision to invest their money
that they do not need with a time deposit because with this decision they will
gain more money because the interest rate is bigger than in a saving account.
Describe how economists measure savings
●Economists measure savings through saving rates which is the amount of
income people have available or the amount of income available after paying
their taxes.
Section 2:
Describe the four elements of a personal financial plan.
●Spending and saving plan: is the amount of money a person need and is
willing to pay for fixed and flexible expenses
●Investment plan: the way a person wants to put their money to work to make
more money.
●Retirement plan: the savings and investments you make for when you retire
and stop working
●Estate plan: It tells who the deceased’s properties and assets are going to
belong to.
How do the purposes of financial and real investments differ?
●Financial investment seeks to benefit the buyer with the purchase in the future
and increase the value of the purchase, it does not create anything new, while
real investment seeks to create something new through the use of money.
Explain how real investment promotes economic growth.
●Real investment promotes economic growth because it increases the amount of
capital goods used by producers, which is known as capital accumulation.
Section 3:
List the main reasons people choose to purchase stock
●To gain a profit
