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HOARDING: The act of accumulating assets, especially goods or money, over and above that needed for immediate use based on the fear or expectation of future shortages and higher prices. For example, concerns about a worldwide shortage of sugar and chocolate might prompt a consumer to purchase several hundred boxes of candy, which are stored in a wine cellar. Alternatively, someone fearing a global collapse of the financial system might be inclined to pack pillow cases with bundles of cash or stockpile gold bullion in the closet. Such hoarding, if widely practiced, can actually contribute to the anticipated shortage and higher prices.
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                           INDETERMINANT: The directional change in a variable, resulting from the disruption of an equilibrium that is identified using comparative statics, is not known. This term is commonly used to indicate that the change in either price or quantity is unknown when the market experiences simultaneous shifts in both the demand and supply curves. For example, an increase in both demand and supply definitely cause an increase in the quantity exchanged. But whether the market price increases or decreases is indeterminant. In some economic models, especially the market model, simultaneous disruptions caused by two or more ceteris paribus factors can generate either known changes or unknown changes in endogenous variables. In those cases where the disruption produces a known change in the direction of the variable (increase or decrease), the change is said to be determinant. In those cases where the disruption does not produce a known change in the direction of a variable (it might increase or it might decrease) the change is said to be indeterminant.Indeterminant Results| Shift | Quantity
Change | Price
Change | Demand and
Supply Increase | Determinant
(Increase) | Indeterminant | Demand and
Supply Decrease | Determinant
(Decrease) | Indeterminant | Demand Increase
and Supply Decrease | Indeterminant | Determinant
(Increase) | Demand Decrease
and Supply Increase | Indeterminant | Determinant
(Decrease) |
Indeterminant results are most often associated with the market model. The simultaneous change in demand and supply, triggered by changes in a demand determinant and a supply determinant, causes the change in either price or quantity to be indeterminant.The table presented at the right summarizes the indeterminant (and determinant) changes in price and quantity for simultaneous shifts of the demand and supply curves. Need to Know MoreThe reason for an indeterminant price or quantity is that the relative magnitude of the shifts of the two curves is unknown. For most introductory comparative static analyses of the market, the only information known is something like "demand decreases and supply increases." HOW MUCH each curve shifts is not often known! If the relative magnitudes of the two shifts are known, then both price and quantity can be determinant. Moreover, with enough information (such as, demand and supply elasticity coefficients) the exact changes in price and quantity can be calculated. Without such information, however, simultaneous shifts of the demand and supply curves mean either price or quantity is indeterminant.
Recommended Citation:INDETERMINANT, AmosWEB Encyclonomic WEB*pedia, http://www.AmosWEB.com, AmosWEB LLC, 2000-2024. [Accessed: September 7, 2024].
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BLUE PLACIDOLA
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Today, you are likely to spend a great deal of time searching for rummage sales wanting to buy either a looseleaf notebook binder or hand lotion, a big bottle of hand lotion. Be on the lookout for telephone calls from former employers.
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Helping spur the U.S. industrial revolution, Thomas Edison patented nearly 1300 inventions, 300 of which came out of his Menlo Park "invention factory" during a four-year period.
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"In a time of drastic change, it is the learners who inherit the future. " -- Eric Hoffer, philosopher
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CPI
Consumer Price Index
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