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In any technical subject, words commonly used in everyday life acquire very specific technical meanings, and confusion can arise when someone is uncertain of the intended meaning of a word. This article explains the differences in meaning between some technical terms used in economics and the corresponding terms in everyday usage.
Coins or currency which must be accepted in payment of debt. legend The principal inscription on a coin. [1] lettered edge The outside edge of a coin containing an inscription. [1] low relief A coin with the raised design not very high above the field. luster The appearance of a coin's ability to reflect light; brilliance.
Also called resource cost advantage. The ability of a party (whether an individual, firm, or country) to produce a greater quantity of a good, product, or service than competitors using the same amount of resources. absorption The total demand for all final marketed goods and services by all economic agents resident in an economy, regardless of the origin of the goods and services themselves ...
In economics, valuation using multiples, or "relative valuation", is a process that consists of: identifying comparable assets (the peer group) and obtaining market values for these assets. converting these market values into standardized values relative to a key statistic, since the absolute prices cannot be compared.
The alternative to a commodity money system is fiat money which is defined by a central bank and government law as legal tender even if it has no intrinsic value. Originally fiat money was paper currency or base metal coinage, but in modern economies it mainly exists as data such as bank balances and records of credit or debit card purchases, [3] and the fraction that exists as notes and coins ...
Gresham's law is a specific application of the general law of price controls. A common explanation is that people will always keep the less adultered, less clipped, less filed, less trimmed coin, and offer the other in the marketplace for the full units for which it is marked. It is inevitably the bad coins proffered, good ones retained.
When economic analysis refers to a particular good as the numéraire, one says that all other prices are normalized by the price of that good. For example, if a unit of good g has twice the market value of a unit of the numeraire, then the (relative) price of g is 2. Since the value of one unit of the numeraire relative to one unit of itself is ...
James Stuart (1767) authored the first book in English with 'political economy' in its title, explaining it just as: . Economy in general [is] the art of providing for all the wants of a family, so the science of political economy seeks to secure a certain fund of subsistence for all the inhabitants, to obviate every circumstance which may render it precarious; to provide everything necessary ...