Microeconomics (Christopher T.S. Ragan) (z-lib.org)

inflation is 5 percent. When the price level is falling, inflation is negative. If prices are falling at a rate of 2 percent per ...

between attainable and unattainable output combinations. resource allocation The allocation of an economy’s scarce resources amo ...

interest rate is the difference between the nominal interest rate and the rate of inflation. If lenders and borrowers are concer ...

command economy An economy in which most economic decisions are made by a central planning authority. free-market economy An eco ...

In this chapter we have examined investment demand by firms and the supply of saving by households. In both cases, the interest ...

Figure 15-5 The Capital Market Figure 15-5 shows how the interest rate is determined in the capital market. The intersection of ...

exogenous variable A variable that is determined outside the theory. Sometimes called an autonomous variable or an independent v ...

Figure 15-6 Changes in the Capital Market Changes in the Market Equilibrium We are now ready to examine some of the changes that ...

price of a product, other things being equal. demand curve The graphical representation of the relationship between quantity dem ...

Changes in the demand for or the supply of financial capital lead to changes in the equilibrium interest rate and levels of inve ...

The amount of a good or service that producers want to sell during some time period. supply schedule A table showing the relatio ...

important reason that the economy’s supply of saving continues to increase. Population Growth An increase in the population—ei ...

goods or services. excess demand A situation in which, at the given price, quantity demanded exceeds quantity supplied. excess s ...

of Figure 15-6. There are three possible causes of an increase in the demand for financial capital. Population and Income Growt ...

relative price The ratio of the money price of one product to the money price of another product; that is, a ratio of two absolu ...

physical capital. One effect of such policies is to increase firms’ demand for financial capital. Reductions in corporate income ...

income elasticity of demand A measure of the responsiveness of quantity demanded to a change in income. normal good A good for w ...

Figure 15-7 Investment, the Capital Stock, and the Real Interest Rate in Canada, 1965–2016 Long-Run Trends in the Capital Market ...

black market A situation in which products are sold at prices that violate a legal price control. utility The satisfaction that ...

The annual flow of investment is quite volatile, although the accumulated capital stock grows more steadily; the real interest r ...