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AD VALOREM TARIFF: A tax on imports that is specified as a percentage of the value of the good or service being taxed. This is one form of trade barrier that's intended to restrict imports into a country. Unlike nontariff barriers and quotas, which increase prices and thus revenue received by domestic producers, an 'ad valorem tariff' generates revenue for the government. For example: a 15 percent ad valorem tariff on a TV set worth $100 would pay a tariff of $15. One advantage of an ad valorem tariff is that it keeps up with changes in prices (mostly inflation).
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PURCHASING POWER: In general the quantities of goods and services that can be bought with a given amount of money. The notable feature of purchasing power is that it declines as prices rise. In particular, inflation is the number one nemesis of purchasing power. When inflation gives higher prices, purchasing power falls. Be careful, though, that you don't get too caught up in the purchasing power of just a single dollar. The real question is not how much stuff one dollar can buy, but how many dollars you have. In other words, while the price of a brand new car might have been $10 when you were a kid (in the good old days), the average annual income was also $20. That's the same purchasing power as a $10,000 car price and a $20,000 income. See also | real | nominal | money | price level | inflation | cost of living | living standard | store of value |
Recommended Citation:PURCHASING POWER, AmosWEB GLOSS*arama, http://www.AmosWEB.com, AmosWEB LLC, 2000-2026. [Accessed: October 8, 2026].
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AVERAGE FACTOR COST AND MARGINAL FACTOR COST A mathematical connection between average factor cost and marginal factor cost stating that the change in the average factor cost depends on a comparison between average factor cost and marginal factor cost. For perfect competition, with no market control, marginal factor cost is equal to average factor cost, and average factor cost does not change. For monopsony and other firms with market control, marginal factor cost is greater than average factor cost, and average factor cost rises.
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BLUE PLACIDOLA
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Today, you are likely to spend a great deal of time wandering around the downtown area trying to buy either a how-to book on home repairs or a large, stuffed kitty cat. Be on the lookout for strangers with large satchels of used undergarments.
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The 1909 Lincoln penny was the first U.S. coin with the likeness of a U.S. President.
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"Do not stop thinking of life as an adventure. You have no security unless you can live bravely, excitingly, imaginatively, unless you can choose a challenge instead of a competence. " -- Eleanor Roosevelt, first lady
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