Economics and Strategy Flashcards
An increase in governmental spending causes
an increase in domestic interest rates AND international capital inflows
What illustrates the quantity of goods supplied at different prices
Supply Curve
what decreases aggregate demand
A decrease in government purchases
These capital inflows cause the domestic currency to appreciate, which has a negative effect on net exports
An increase in governmental spending causes
What is the price that urban consumers paid for a fixed basket of goods and services in relation to the price of the same goods and services purchased in some base period
Consumer Price Index
What encourages borrowing and investment which stimulates economic growth.
lowering the discount rate
the difference in savings divided by the difference in income
calculation of marginal propensity to save
rate of the risk-free rate plus the expected rate of inflation
Calculation of Treasury bill interest
fixed assets are valued at historical cost and, therefore, depreciation does not reflect the current cost of the related assets happens when
inflation distort reported income
What happens in a scenario when - an increase in the price of one tends to decrease the quantity demanded of the other.
The package of goods becomes more expensive.
If two goods are complements
there are a large number of buyers and sellers; no single participant or group of participants can influence market prices.
happens in a perfectly competitive financial market
What measures the price change of a bundle of consumer goods. (Rate of inflation)
Consumer Price Index
