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PAR VALUE: The stated, or face, value of a legal claim or financial asset. For debt securities, such as corporate bonds or U. S. Treasury securities, this is amount to be repaid at the time of maturity. For equity securities, that is, corporate stocks, this is the initial value set up at the time it is issued. Par value, also called face value, is not necessarily, and often is not, equal to the current market price of the asset. A $10,000 U.S. Treasury note, for example, has a par value of $10,000, but might have a current market price of $9,950. The difference between par value and current price contributes to the yield or return on such assets. An asset is selling at a discount if the current price is less than the par value and is selling at a premium if the current price is more than the par value.
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                           MARKET-ORIENTED ECONOMY: A mixed economy that relies heavily on markets to answer the three questions of allocation, but with a modest amount of government involvement. While it is commonly termed capitalism, the term market-oriented economy is much more descriptive of the structure of the economy. The United States is the primary example of a market-oriented economy. A market-oriented economy takes to heart the fifth rule of imperfection. Such an economy relies predominately on the efficiency of competitive markets to allocate resources, but governments enter the fray with economic policies to address market failures, business cycles, and other problems that might arise. The United States, for example, answers about two-thirds to three-fourths of the economy's resource allocation questions with markets. The remaining one-fourth to one-third are answered by governments.The key institutions that form the foundation of a market-oriented economy are: - Private Property: Private individuals, rather than governments, are the primary owners of resources, goods, and other assets.
- Individual Freedom: Those who own resources, goods, and other assets have the freedom to use their property as they see fit.
- Competitive Markets: Market are used to exchange privately owned commodities and to answer the three questions of allocation.
These three institutions create an economic environment that provides the incentives to achieve efficiency. In a market-oriented economy, buyers and sellers have the freedom to direct their resources through competitive markets to the highest valued uses. A market-oriented economy, however, is definitely a mixed economy. While most allocation decisions are made voluntarily through market exchanges, governments also impose choices on the economy through regulations, taxes, and spending. Two key functions that governments provide in a market-oriented economy are: - Legal System: Governments operate the legal system to establish the "rules of the game" and maintain order throughout society. Without such order individuals are discouraged from undertaking voluntary market exchanges.
- Public Goods: Governments provide public goods, like national defense and education, that cannot be efficiently provided through voluntary market exchanges. These goods are provided directly through taxes and spending or indirectly through regulatory oversight.
 Recommended Citation:MARKET-ORIENTED ECONOMY, AmosWEB Encyclonomic WEB*pedia, http://www.AmosWEB.com, AmosWEB LLC, 2000-2025. [Accessed: July 15, 2025]. Check Out These Related Terms... | | | | | | | Or For A Little Background... | | | | | | | | | And For Further Study... | | | | | | | | | | | | |
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PINK FADFLY [What's This?]
Today, you are likely to spend a great deal of time flipping through mail order catalogs hoping to buy either a flower arrangement for that special day for your mother or a New York Yankees baseball cap. Be on the lookout for letters from the Internal Revenue Service. Your Complete Scope
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The penny is the only coin minted by the U.S. government in which the "face" on the head looks to the right. All others face left.
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"The time to repair the roof is when the sun is shining." -- John F. Kennedy, 35th U. S. president
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EFTS Electronic Fund Transfer Systems
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