Inflation
what is inflation
inflation is the general increase in prices over time, reducing the purchasing power of money.
what are the three P's
what to produce? how to produce? and for whom to produce?
what is the stock market
it is a marketplace where portions of ownership in companies called shares or stocks are bought and sold.
If CPI raises 3%, how much is inflation?
inflation would be around 3%
what are the four main systems
traditional, command, market, and mixed.
What are the two main parts of the stock market called?
Primary market and secondary market.
what are three positive effects of inflation
1. encourages sales
2. debt-relief
3. wage adjustments
which type of economy relies on farming, hunting, gathering, and bartering.
Traditional economy
what does IPO stand for?
Initial Public Offering
what is PPI
Produce price index - measures wholesale prices signaling future consumer inflation.
What form of government believes in "ultimate equal"
Communist government
What is a market cap?
Total value of a company's shares (price × number of shares).
What are three causes for inflation
1. demands exceeds supply
2. production costs rise
3. workers demand higher wages to keep up with prices, leading to more inflation
what are the 5 shifters of demand
1. tastes/preferences
2. number of consumers
3. related goods prices
4. income
5. expectations
what's the difference between common stock and preferred stock?
common stock gives voting rights at shareholder meetings and potential dividends, but it's riskier. Preferred stock offers fixed dividends and priority in payouts, but usually no voting rights and less growth potential.