. Gross Value Added (GVA): Formula and Example What does GVA stand for economics? GVA stands for Gross Value Added and is a measure of the value of goods and services produced in an economy. It is a key indicator of economic activity and growth. How do you calculate economic value? The economic value of … Read more
Imperfect competition is a market structure where there are many small firms, each producing a slightly differentiated product. The key characteristics of imperfect competition are: There are many firms in the market Each firm has a small market share Each firm produces a slightly differentiated product There are no barriers to entry or exit Firms … Read more
How to Use the Gross Domestic Product (GDP) Formula What are the main components of measuring GDP with what is demanded? The main components of measuring GDP are: 1) Gross Domestic Product (GDP) 2) Gross National Income (GNI) 3) Net National Income (NNI) 4) National Income (NI) These components are all interrelated, and measuring GDP … Read more
A flash crash is a sudden, dramatic drop in stock prices. It is named for the way prices seem to “crash” in a short period of time. A flash crash can happen when there is a sudden sell-off of stocks, or when there is a sudden change in the way traders value stocks. Flash crashes … Read more
Bundling is an economic term that refers to the practice of selling two or more products or services together at a single price. For example, a cable company might offer a bundle that includes cable TV, Internet, and phone service. The advantage of bundling for the consumer is that it can provide a discounted price … Read more
The traditional theory of capital structure definition states that a firm’s optimal or ideal capital structure is the mix of debt and equity that minimizes its cost of capital. The theory is based on the premise that the market value of a company is the present value of its future cash flows, and that the … Read more
Total Utility Defined and Illustrated. What do you mean by total utility? Total utility is the sum of all the utilities that a person derives from consuming a good or service. A utility is a measure of the satisfaction that a person derives from consuming a good or service. What is Total utility explain with … Read more
The Architecture Billings Index (ABI) is a leading economic indicator for the U.S. construction industry. The ABI measures the amount of billings issued by architects to their clients each month and is a leading indicator of construction spending. The ABI is released by the American Institute of Architects (AIA) on the last working day of … Read more
A sine wave is a mathematical function that describes a repeating wave-like pattern. It is often used to represent periodic phenomena, such as sound and light waves. The function is defined by the following equation: y(t) = A * sin(2 * pi * f * t) where: y(t) is the value of the wave at … Read more
Autonomous expenditure is defined as spending that is not determined by current income levels but instead is determined by other factors. This includes spending on things like investment, government expenditure, and exports. Autonomous expenditure is important because it can provide a boost to the economy even when income levels are low. What is meant by … Read more
