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VERIFIED PRINCIPLE: A generally accepted, verified, fundamental law of nature that has been tested against and verified with real world data. A verified principle begins as an hypotheses implied by a theory, which is then compared against real world observations. If the hypothesis is consistently supported by data, it achieves the rank "verified" principle. This should be contrasted with unverifiable axiom.

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INVESTMENT, PRODUCTION POSSIBILITIES: Investment typically refers to the purchase of productive capital by business in anticipation of increasing production and (presumably) generating more profit. More generally, investment can be considered as sacrificing the current satisfaction of wants and needs (consumption goods) to expand productive capability (capital goods). Production possibilities analysis can be used to illustrate the tradeoff between consumption and capital as a movement along a production possibilities curve.

     See also | economic growth, production possibilities | economic growth, sources | full employment, production possibilities | unemployment, production possibilities | derivation, production possibilities curve | slope, production possibilities curve | opportunity cost, production possibilities | law of increasing opportunity cost | investment | opportunity cost | scarcity | economic growth | production possibilities | production possibilities curve | assumptions, production possibilities | graphical analysis | limited resources | economic efficiency | efficiency | economic goals | seven economic rules | free lunch | three questions of allocation | four estates | government functions | political views | technology | investment expenditures | investment business cycles |


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MARKET ADJUSTMENT

The economic analysis of changes in market equilibrium caused by changes in any of the five demand determinants and/or the five supply determinants. Market adjustment comes in one of eight varieties, given that the two curves comprising the market (demand curve and supply curve) can either increase or decrease, individually or simultaneously. Four adjustments involve a shift of EITHER the demand curve OR the supply curve. The other four adjustments involve shifts of BOTH the demand curve AND the supply curve.

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