ECONOMICS

Hyperinflation Hyperinflation is a rapid, uncontrollable increase in the rate of inflation. It generally refers to an annual inflation rate of 50% or more. Causes of Hyperinflation: Excessive money creation: When a country creates too much money, it can lead to a surge in demand for goods and services, driving up inflation. Supply chain disruptions: […]

Definition:Dispersion is the spreading out of light waves as they pass through a prism or other optical device. Mechanism:When light waves pass through a prism, they are refracted (bent) differently according to their wavelengths. Shorter wavelengths (blue light) are refracted more than longer wavelengths (red light). This spreading out of light waves is known as […]

Market penetration is a marketing strategy that focuses on increasing the market share of a company’s products or services in a particular market. This is achieved by targeting existing customers and potential customers within that market. Key elements of market penetration: 1. Customer targeting: Identifying and understanding the specific customer segments within the target market.2. […]

Definition: The law of supply is a fundamental economic principle that states that the quantity of a good or service that producers are willing to offer for sale at a given price will increase as the price increases, and decrease as the price decreases. Key Principles: Quantity Offered: The quantity of a good or service […]

The GDP deflator is a measure of inflation that measures the overall change in prices in a country’s economy. It is calculated by dividing GDP price index by GDP deflator. The GDP deflator is a key indicator of inflation and is used by central banks to control inflation. The GDP deflator is important because it […]

Fiat Money Fiat money is a type of money that is not backed by a physical commodity, such as gold or silver. Instead, it is backed by the government’s authority and its promise to redeem it for its face value. Fiat money is also commonly known as “paper money.” Examples of Fiat Money: U.S. dollar […]

Definition: The financial sector is a group of industries that provide financial services to individuals and businesses. It includes a wide range of institutions, such as banks, credit unions, insurance companies, and investment firms. Major Components: Banking: Deposits, loans, payments, wire transfers, and other services. Insurance: Protection against loss or damage. Investment banking: Advising companies […]

A Giffen good is a type of good that exhibits the paradoxical behavior of increasing in demand when its price increases. This seemingly paradoxical behavior occurs because the good is so cheap that even a proportionally large increase in its price does not significantly impact its affordability for the majority of consumers. Instead, the increase […]

Purchasing Power Parity (PPP) is a macroeconomic theory that relates the prices of goods and services in different countries to their relative purchasing power parity. Key Concepts: Purchasing Power Parity (PPP) is a theory that the prices of identical goods and services in different countries should be equal after adjusting for the differences in cost […]

Economic Value Economic value is a measure of the positive impact of an asset or activity on a company’s financial performance. It refers to the ability of an asset to generate financial returns that are greater than its cost of acquisition. Key Concepts: Incremental Cash Flows: Economic value is based on the incremental cash flows […]