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ADJUSTMENT, SHORT-RUN AGGREGATE MARKET: Disequilibrium in the short-run aggregate market induces changes in the price level that restore equilibrium. If the price level is above the short-run equilibrium price level, economy-wide product market surpluses cause the price level to fall. If the price level is below the short-run equilibrium price level, economy-wide product market shortages cause the price level to rise. In both cases short-run equilibrium is restored. You might want to compare adjustment, long-run aggregate market. Price level changes induce changes in both aggregate expenditures and real production. Unlike the long-run aggregate market, changes in the price level can induce changes in short-run aggregate supply, making it greater or less than full-employment real production.
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                           FIXED INVESTMENT: Capital investment expenditures for factories, machinery, tools, and buildings. This is one of two main categories of gross private domestic investment included in the National Income and Product Accounts maintained by the Bureau of Economic Analysis. The other category is change in private inventories. This category is generally about 95 to 97 percent of gross private domestic investment and includes the capital goods that best reflect what most people consider capital investment. Fixed investment is expenditures made by the business sector',500,400)">business sector for the factories and equipment used as productive resources. Business expenditures for fixed investment are not only critical for expanding the economy's long-run production capabilities, they also play a key role in short-run business cycles. Expansions see more fixed investment and contractions see less.Fixed investment is divided into two major categories: nonresidential and residential. Each of these subcategories is then further divided into structures and producers' durable equipment. - The nonresidential category is just under 70 percent of gross private domestic investment and just over 70 percent of fixed investment. This subcategory includes structures (buildings, pipelines, oil wells) and producers' durable equipment (computers, machinery, vehicles). Structures are about one-fourth of nonresidential fixed investment and producers' durable equipment is about three-fourths.
- The residential category primarily includes houses and apartments, and comes in at just under 30 percent of both fixed investment and gross private domestic investment. Like nonresidential fixed investment, residential fixed investment is divided into structures and producers' durable equipment. Structures are separated into single family (houses) and multifamily (apartments).
Of some importance, single family structures can be owned by either a business or an individual. In other words, the production of an owner-occupied house is included as gross private domestic investment in the National Income and Product Accounts. This is the only notable purchase made by the household sector that is not included in personal consumption expenditures. Structures are about 98 percent of this residential category and producers' durable equipment is the remaining 2 percent.
 Recommended Citation:FIXED INVESTMENT, AmosWEB Encyclonomic WEB*pedia, http://www.AmosWEB.com, AmosWEB LLC, 2000-2025. [Accessed: July 18, 2025]. Check Out These Related Terms... | | | | | | | | Or For A Little Background... | | | | | | | | | | | | And For Further Study... | | | | | | | | | | | | | | | | Related Websites (Will Open in New Window)... | | |
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Today, you are likely to spend a great deal of time searching the newspaper want ads trying to buy either a T-shirt commemorating the 2000 Olympics or a genuine fake plastic Tiffany lamp. Be on the lookout for telephone calls from former employers. Your Complete Scope
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Paper money used by the Commonwealth of Massachusetts prior to the U.S. Revolutionary War, which was issued against the dictates of Britain, was designed by patriot and silversmith, Paul Revere.
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"A winner is someone who recognizes his God-given talents, works his tail off to develop them into skills, and uses those skills to accomplish his goals. " -- Larry Bird, basketball player
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SFA Securities and Futures Authority (UK)
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