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INFLATION PREMIUM: The difference between the nominal interest rate and the real interest rate. The role of the inflation premium is, quite simply, to adjust the interest rate for inflation. The nominal interest rate (the one on the loan contract) includes a real interest rate needed by the lender and a surcharge equal to the expected inflation rate used to maintain the purchasing power of the future payments. This expected inflation rate is the inflation premium.
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PERFECT COMPETITION, REVENUE DIVISION The marginal approach to analyzing a perfectly competitive firm's short-run profit maximizing production decision can be used to identify the division of total revenue among variable cost, fixed cost, and economic profit. The U-shaped cost curves used in this analysis provide all of the information needed on the cost side of the firm's decision. The demand curve facing the firm (which is also the firm's average revenue and marginal revenue curves) provides all of the information needed on the revenue side.
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WHITE GULLIBON
[What's This?]
Today, you are likely to spend a great deal of time at a crowded estate auction looking to buy either high-gloss photo paper that works with your printer or a desktop calendar with all federal and state holidays highlighted. Be on the lookout for slightly overweight pizza delivery guys.
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Okun's Law posits that the unemployment rate increases by 1% for every 2% gap between real GDP and full-employment real GDP.
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"As the births of living creatures at first are ill-shapen, so are all innovations, which are the births of time. " -- Sir Francis Bacon, philosopher
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PHLX
Philiadelphia Stock Exchange
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