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RATE OF RETURN: The ratio of the additional annual income or profit generated by an investment to the cost of the investment. Here's a simple example, although the calculations are usually a great deal more involved for actual investments. If the cost of constructing a new factory is $10 million and it gives you an extra $1 million in profit each year, then its rate of return is 10 percent.
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ASYMMETRIC INFORMATION Information is not equally available to everyone. Asymmetric information results because efficient information search inevitably stops short of compete information. Some people obtain more benefits from information than others, are willing to incur higher search costs, and thus end up knowing more. Or they incur lower information search costs and have easier access to the information. In a market, sellers tend to have more information about the good than buyers. Asymmetric information gives rise to adverse selection, moral hazard, and the principal-agent problem. These problems can be lessened through signalling and screening.
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PINK FADFLY
[What's This?]
Today, you are likely to spend a great deal of time at a garage sale wanting to buy either a hepa filter for your furnace or a wall poster commemorating next Thursday. Be on the lookout for florescent light bulbs that hum folk songs from the sixties.
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Three-forths of the gold mined each year is used to manufacture jewelry.
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"It is not the mountain we conquer, but ourselves. " -- Sir Edmund Hillary, Explorer
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CME
Chicago Mercantile Exchange
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