Microeconomics › Section Q · Financial markets › Topic Q.2
How households supply financial capital
Every household that saves is lending to someone, whether it knows it or not. Bank deposits, bonds, shares, funds and houses each offer a different mix of return, risk and access to your money, and understanding that mix is the core of this topic. (It is economics education, not financial advice.)
In this topic
- Three questions about any investment
- Two kinds of risk
- Banks as intermediaries
- Why bank deposits are so safe
- Bonds: return depends on the borrower
- Worked example: a bond after rates rise
- Stocks and stock indexes
- Mutual funds and diversification
- Worked example: building home equity
- The risk-return trade-off
- Common mistakes to avoid
- Key takeaways
This topic is part of Wuanberri Pro. Checking your access…