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PERFECT COMPETITION, LONG-RUN ADJUSTMENT: A perfectly competitive industry undertakes a two-part adjustment to equilibrium in the long run. One is the adjustment of each perfectly competitive firm to the appropriate factory size that maximizes long-run profit. The other is the entry of firms into the industry or exit of firms out of the industry, to eliminate economic profit or economic loss. The end result of this long-run adjustment is a multi-faceted equilibrium condition that price is equal to marginal cost and average cost (both short run and long run).

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Lesson 5: Market Demand | Unit 4: Determinants Page: 13 of 20

Topic: Ceteris Paribus Factors <=PAGE BACK | PAGE NEXT=>

Ceteris paribus is the notion that other things remain constant. We make this assumption because things other than price affect demand.
  • These other, ceteris paribus factors, give us useful analytical tools for examining demand and the market.
  • We can turn these factors off and on to better understand how the market works.
  • The ceteris paribus factors are called demand determinants.

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BANK LIABILITIES

What a bank owes, including most notably customer deposits. Bank liabilities are typically listed on the right-hand side of a bank's balance sheet. Bank assets, what a bank owns, are listed on the left-hand side of a bank's balance sheet. Net worth is the difference between assets and liabilities. The most important liability category of most bank is checkable deposits, which is part of the economy's M1 money supply. The largest liability category includes other types of deposits (especially savings deposits, certificates of deposit, and money market deposits) that enter into the M2 and M3 monetary aggregates.

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PURPLE SMARPHIN
[What's This?]

Today, you are likely to spend a great deal of time flipping through the yellow pages hoping to buy either a flower arrangement for that special day for your mother or a New York Yankees baseball cap. Be on the lookout for pencil sharpeners with an attitude.
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There were no banks in colonial America before the U.S. Revolutionary War. Anyone seeking a loan did so from another individual.
"Experience keeps a dear school, but fools will learn in no other. "

-- Benjamin Franklin

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