Definition: Inflation implies acceleration in the universal price level or moderate level of prices, of all goods and services. In microeconomics, the price of goods is determined when the demand is equal to its supply. Precisely, any factor that either reduces supply or increases demand creates Inflation and when the general price level continues to rise over a long time, it … [Read more...] about Inflation
Search Results for: inflation
Unit Linked Insurance Plan (ULIP)
Definition: Unit linked insurance plan (ULIP) is a bundled financial product proposed for those investors who need a life cover as well. It comprises of insurance benefit along with investment opportunity, to serve the dual purpose of safety and wealth maximization to the investors. ULIP was developed in India and is widely known for its tax-saving benefits among the … [Read more...] about Unit Linked Insurance Plan (ULIP)
Multinational Capital Budgeting
Definition: Multinational Capital Budgeting (MCB) is the decision-making process wherein financial managers evaluate long-term projects based on foreign lands worthy of investment. Multinational companies (MNCs) aspire to invest outside their geographical boundaries. This is because they want to make the best use of their valuable resources. If we split the keyphrase, … [Read more...] about Multinational Capital Budgeting
Investment Multiplier
Definition: The concept of Investment Multiplier suggests that the increase in Investments will lead to income generation in multiples. In other words, the amount of Income/Output amplifies, resulting from the increase in the level of Investments. Investment Multiplier is the contribution of the famous economist John Keynes. He explained it with the help of the country's … [Read more...] about Investment Multiplier
Dispute Resolution
Definition: Dispute Resolution refers to a process through which two parties can come together and build a consensus to end the conflict. Another term for the same is Conflict Resolution. But it is a broader term that covers severe matters. Dispute Resolution covers all the methods of managing disputes. Also, this process requires plenty of time and energy. Another … [Read more...] about Dispute Resolution
Consumer Price Index (CPI)
Definition: Consumer Price Index or CPI is the universal measure used for estimating the general price level of the goods and services produced in any nation. Every month the Bureau of Labor Statistics (BLS) computes and report the Consumer Price Index. It is a calculation of the accepted price paid by the metropolitan as well as rural users for a market basket of consumer … [Read more...] about Consumer Price Index (CPI)
Business Cycle
Definition: Business cycle also termed as trade cycle displays the ebbs and flows of the economic activities occurring regularly, i.e., it shows the fluctuation movements or rhythmical changes in the level of aggregate economic activity. In other words, business cycle is the fluctuation cycle of economic activities that are more or less regular in time sequence. The level of … [Read more...] about Business Cycle
Purchasing Power Parity (PPP)
Definition: Purchasing Power Parity (PPP) is a beneficial tool for determining the exchange rate. The Purchasing Power Parity among the two nation’s currencies is the nominal exchange rate at which accustomed basket of services and goods would charge the constant amount in every nation. For instance, Suppose the basket of services and goods that charges. 100 £ in the UK, … [Read more...] about Purchasing Power Parity (PPP)
Indexation
Definition: Indexation is relief on long-term investments. A long-term investor can claim it merely by showing that, the value of their assets raised is not a real gain, but it rises only due to inflation. It is the inevitable link between monetary constraints and price level. It diminishes the cost of inflation and is enforced on interest, taxes and wages. For instance, … [Read more...] about Indexation
Gross Domestic Product (GDP)
Definition: Gross Domestic Product (GDP) is the total market value of the services and final goods formed within a nation's boundaries in a financial year. It is used to measure the comprehensive achievement of an economy. The nations' GDP growth is calculated with an increase in the GDP from the previous year to the current year, which can be calculated yearly or … [Read more...] about Gross Domestic Product (GDP)