Explain the Relationship Between Surplus Units and Deficit Units

1150 WordsFeb 14, 20115 Pages
Assignment Template for Individual Assignments Subject Code: 333101 Student ID Number: 387399 Subject Name: Finance 1 Student Name: Yaxi Huang Assignment Name or Number: assignment one In this paper, I would report in two different parts. One of them is that why a typical university student is likely to be a deficit unit and another part is discussing how any one function of the financial system impacts on a typical university student. Before the paper proceeds, I would first briefly introduce some related concepts which would be referred in my following words. As I referred before, key words for the first part of my report are deficit unit and surplus unit. The deficit units require funds to meet planned expenditures and…show more content…
he might get lower mark or failed in the final exams if he pay too much attention on the part-time job. And for most of students, the best way to avoid this situation is chose not to do the part-time job or only put a few time in part time job. Absolutely the money earned from part time job is limited, so in general, although students could get the part-time job, they are still deficit units. The second part of my report is discussing how a function of financial system affects a typical university student. And the function I would use in my report is flow of funds. Flow of funds refers to financing that generally is based on sang and the investment of funds. (Ben Hunt and Chris Terry, 2005:4) As I said before, we are financing funds from surplus units. If we borrowed money from the banks to pay the fees of course, it is a kind of flow of funds. The banks are intermediaries, in another words, bans are mainly parts of authorized deposit-taking institutions. They get money from the surplus units and then borrow money to us. We need to pay higher interest rate to bank than the bank paid to surplus unit. So the funds flow from the surplus unit to us. It was very important to a typical university student, we are required money to pay fees, and the ADIs financing funds then borrow to us. so we could meet the planned expenditures. Finance is not only a subject but a very important part of our life. We learn finance now and compose a part of financial world, at
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