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LAW: Generally accepted, verified, fundamental principle of nature. Laws have been tested and verified through the scientific method. As a house is constructed from concrete, lumber, and nails, a theory is constructed from laws. To be a fundamental law of nature, a principle must capture a cause-and-effect relationship about the workings of the world.
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Lesson 20: Federal Reserve System | Unit 1: The Fed
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Page: 1 of 20
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A key player in the medieval money game: Clarence the King. Clarence is the government regulator. Because Fred practices fractional-reserve banking like modern banks, he has a problem: - Several knights redeem their gold receipts at the same time, but Fred does not have sufficient reserves.
- King Clarence provides Fred with enough gold to satisfy the knights.
- If Fred's banking operation ceases to exist, economic prosperity is also in jeopardy.
- King Clarence decides to watch Fred to make sure that he keeps enough gold in reserve to avoid similar problems.
This is how King Clarence sort of 'discovers' the regulatory function of the modern banking system.
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AVERAGE FACTOR COST, PERFECT COMPETITION Total factor cost per unit of factor input employed by a perfectly competitive firm in the production of output, found by dividing total factor cost by the quantity of factor input. Average factor cost, abbreviated AFC, is generally equal to the factor price. However, using the longer term average factor cost makes it easier to see the connection to related terms, including total factor cost and marginal factor cost.
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Three-forths of the gold mined each year is used to manufacture jewelry.
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"You are never given a dream without also being given the power to make it true." -- Richard Bach, Author
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NZFOE
New Zealand Futures and Options Exchange
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