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FIXED EXCHANGE RATE: An exchange rate that's established at a given level and maintained through government (usually central bank) actions. To fix the exchange rate, a government must be willing to buy and sell currency in the foreign exchange market in whatever amounts are necessary. A fixed exchange rate typically disrupts a nation's balance of trade and balance of payments. If the exchange rate is fixed too low, then a government needs to sell it's currency in the foreign exchange market, and may end up expanding the money supply too much, which then causes inflation. If the exchange rate is fixed too high, then export sales to other countries are curtailed and the economy is likely to slide into a recession.
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FACTOR PRICE: The price paid for and received by the services of factor of productions (labor, capital, land, and entrepreneurship) when exchange through factor markets. Like prices in other markets, factor price adjusts to balance the forces of demand and supply. For factor demand and the factor demand curve, the factor price is negatively related to the quantity of factor services demanded. For factor supply and the factor supply curve, factor price is positively related to the quantity of factor services supplied. The key factor prices are wage rates, interest rates, rents, and profits. The rigidity or inflexibility of factor prices is an important aspect of the macroeconomic study of the short-run aggregate market. See also | wage | interest | rent | profit | labor | capital | land | entrepreneurship | factor price | factor demand | factor supply | factor markets | factors of production | circular flow | business sector | household sector | national income |
Recommended Citation:FACTOR PRICE, AmosWEB GLOSS*arama, http://www.AmosWEB.com, AmosWEB LLC, 2000-2025. [Accessed: March 26, 2025].
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GRAPHICAL ANALYSIS The process of investigating phenomena, especially economic phenomena, in a systematic manner using diagrams and graphs. Graphical analysis is commonly used to display abstract scientific relations, then to manipulate those relations to gain greater understanding of real world events. The market model is a primary example of graphical analysis.
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GRAY SKITTERY
[What's This?]
Today, you are likely to spend a great deal of time strolling through a department store trying to buy either a solid oak entertainment center or a remote controlled ceiling fan. Be on the lookout for malfunctioning pocket calculators.
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On a typical day, the United States Mint produces over $1 million worth of dimes.
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"You are the only problem you will ever have and you are the only solution. Change is inevitable, personal growth is always a personal decision." -- Bob Proctor, Author and Speaker
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LRAS
Long Run Aggregate Supply
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