Working on UCI Cap Markets for a Cert. Any thoughts on this question?" Can you name three Funds Deficit Units and three Funds Surplus Units?"
The Purpose of Capital Markets
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The course suggests Banks are Funds Surplus units. And a home buyer is a Funds deficit unit. What about a pawnbroker? Funds Surplus unit?
Under the same lesson, but under the topic of FUNDS DEFICIT AND SURPLUS UNITS, it states, "Funds Deficit Units are individuals, corporations and governments that spend more than they currently own. Funds Surplus Units are entities that spend less than they currently earn."
I would also like to add that Banks spend less than they currently own. The bank that loaned the money to the buyer is loaning out less money than what they already have. On the other hand, the buyer is buying with more money than what they currently have. It is a good idea to review my initial post previous to this one to better understand fund deficit and surplus units in the markets.
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A last note, the summary page of the lesson also stated, "That an entity transferring future expected income levels into the present is called a Funds Deficit Unit. One choosing to transfer current income for use in the future is called a Funds Surplus Unit."