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EXCESS DEMAND: A disequilibrium condition in a competitive market in which the quantity demanded is greater than the quantity supplied, hence there's "extra" demand. Pointy-headed economists generally use the more technical term shortage rather than excess demand. The reason, of course, is that shortage has two syllables and excess demand has four. The time saved in pronouncing two syllables rather than four is a definite efficiency plus for the entire economy.
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Lesson 19: Money Creation | Unit 2: Fred Returns
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Page: 6 of 23
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Our honest and trustworthy Fred discovers paper currency. Fred's system: - Fred tracks gold deposits and withdrawals by issuing receipts for each deposit.
- Fred returns the gold in exchange for a receipt.Three features:
- First: The knight need not, and probably does not, withdraw the same gold deposited.
- Second: Fred need not personally know each knight requesting services.
- Third: Gold receipts are as good as gold, because people know the receipts can be redeemed for gold.Therefore:
- Gold receipts become money for the local economy.
- Fred has discovered paper currency, fiat money, and what is comparable to the checkable deposit function of modern banks.
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ABSOLUTE ADVANTAGE The general ability to produce more goods or services using fewer resources. A person or country has an absolute advantage in production largely due to superior technology or greater technical efficiency. A related, but contrasting concept is comparative advantage. Both terms are perhaps most important to the study of international trade, but also provide insight into other exchanges.
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GRAY SKITTERY
[What's This?]
Today, you are likely to spend a great deal of time at a flea market seeking to buy either a handcrafted bird house or a weathervane with a chicken on top. Be on the lookout for bottles of barbeque sauce that act TOO innocent.
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A U.S. dime has 118 groves around its edge, one fewer than a U.S. quarter.
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"The road to success is always under construction. " -- Lily Tomlin, Actress
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AACCLA
Association of American Chambers of Commerce in Latin America
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