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LOAN: In general, a transaction in which a legal claim is exchanged for money. The legal claim is typically a contract or promissory note stipulating when and how the money will be repaid. The lender gives up the money and receives the legal claim. The borrower gives up the legal claim and receives the money. A loan can be either an asset or a liability, depending on who does the borrowing and who does the lending. To the borrower, a loan is a liability, something that is owed. The borrower must pay off the loan or repurchase the legal claim. However, to the lender, a loan is an asset, something that is owned. In fact, loans represent a significant part of a bank's assets.
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Lesson 10: Gross Domestic Product | Unit 5: Issues
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Page: 24 of 25
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Topic:
What It Doesn't Do
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GDP and related measures are not perfect.- GDP is only an indicator of economic activity. Because it requires interpretation and analysis it is subject to misinterpretation and misanalysis.
- GDP is an aggregate measure for the economy. It measures total production, but it does not indicate who receives the production, the distribution of production.
- GDP does not measure the satisfaction of wants and needs. GDP can increase even though welfare does not increase, or even decreases. GDP might even decrease even though welfare is greater.
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ARC ELASTICITY The average elasticity for discrete changes in two variables. The distinguishing characteristic of arc elasticity is that percentage changes are calculated based on the average of initial and ending values of each variable, rather than initial values. Arc elasticity is generally calculated using the midpoint elasticity formula. The contrast to arc elasticity is point elasticity. For infinitesimally small changes in two variables, arc elasticity is the same as point elasticity.
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Potato chips were invented in 1853 by a irritated chef repeatedly seeking to appease the hard to please Cornelius Vanderbilt who demanded french fried potatoes that were thinner and crisper than normal.
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"The greatest things ever done on Earth have been done little by little. " -- William Jennings Bryan
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JPUBE
Journal of Public Economics
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