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LEGAL RESERVES: The total amount of vault cash or Federal Reserve deposits of a bank. These are the only bank assets that can be used legally to satisfy reserve requirements.
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Lesson 5: Demand | Unit 4: Determinants
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Page: 16 of 20
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The five determinants that cause the demand curve to shift are:- Income: Income affects the ability of buyers to buy. It can affect a good in two ways-normal or inferior.
- Preferences: Preferences, our likes and dislikes, affect the willingness of buyers to buy.
- Prices of other goods: Other goods can be either substitutes or complements to the good we're analyzing.
- Expectations: Buyers' current demand depends on expectations of future prices.
- Number of buyers: More buyers, more demand. Fewer buyers, less demand.
These categories include all factors other than price that affect demand.
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AUTONOMOUS INVESTMENT Business investment expenditures that do not depend on income or production (especially national income or even gross domestic product). That is, changes in income do not generate changes in investment. Autonomous investment is best thought of as investment that the business sector undertakes regardless of the state of the economy. It is measured by the intercept term of the investment line. The alternative to autonomous investment is induced investment, which does depend on income.
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PURPLE SMARPHIN [What's This?]
Today, you are likely to spend a great deal of time browsing through a long list of dot com websites hoping to buy either hand lotion, a big bottle of hand lotion or a lighted magnifying glass. Be on the lookout for broken fingernail clippers. Your Complete Scope
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Mark Twain said "I wonder how much it would take to buy soap buble if there was only one in the world."
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"Good judgment comes from experience, and often experience comes from bad judgment." -- Rita Mae Brown ‚ Writer
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DCF Discounted Cash Flow
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