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REPURCHASE AGREEMENT: A common type of bank account in which funds are transferred from one account to another, then automatically transferred back after a short period, usually overnight. In effect, a bank customer buys a legal claim from a bank with the understanding that the bank will automatically "repurchase" this legal claim back after a specified time period. Repurchase agreements were original developed as a round about means of paying interest on business checking, which such interest paying was legally prohibited. Repurchase agreements are near monies added to M1 to obtain broader monetary aggregates, M2 and M3.
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MULTIPLIER: The cumulatively reinforcing interaction between consumption and production that amplifies changes in investment, government spending, or exports. In other words, if businesses decide to increase investment expenditures on capital goods or if government decides to expand the size of the already bloated federal deficit by spending more on national defense, then our economy's production and income are likely to increase by some multiple of this spending. The amplified increase in production and income, usually from 2 to 5 times, is what gives us the term "multiplier." The process is based on the circular flow idea the people receive income by producing goods and then spend this income on additional production. See also | consumption | production | investment | government purchases | net exports | income | circular flow | Keynesian economics | business cycle | gross domestic product | expansion | contraction | recovery |
Recommended Citation:MULTIPLIER, AmosWEB GLOSS*arama, http://www.AmosWEB.com, AmosWEB LLC, 2000-2024. [Accessed: May 12, 2024].
AmosWEB Encyclonomic WEB*pedia:Additional information on this term can be found at: WEB*pedia: multiplier
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MACROECONOMIC SECTORS The four aggregate sectors of the macroeconomy--household, business, government, and foreign--that reflect four key macroeconomic functions and are responsible for four expenditures on gross domestic product. These four sectors are the primary "actors" on the macroeconomic stage. Macroeconomic theories then explain macroeconomic phenomena by exploring the interaction among these four sectors.
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In 1914, Ford paid workers who were age 22 or older $5 per day -- double the average wage offered by other car factories.
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"The tragedy of life is not so much what men suffer, but rather what they miss. " -- Thomas Carlyle, Historian
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IJIO
International Journal of Industrial Organization
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