What is QE3 (quantitative easing)?

July 8, 2024 No Comments

A: “Quantitative easing” refers to steps that the U.S. Federal Reserve takes in attempting to boost the country’s lagging economy. Historically, the Fed’s main tool for spurring growth has been lowering short-term rates. However, QE employs expansionary monetary policy, which involves the purchasing of bonds

What is the “percentage off the 52-week high or low”? How is this calculated?

July 8, 2024 No Comments

A: The “percentage off the 52-week high or low” refers to when a security’s current price is relative to where it has traded over the last 52 weeks. This gives investors an idea of how much the security has moved in the last year and

What is the correlation between money supply and GDP?

July 8, 2024 No Comments

A: It is difficult to measure the money supply, but most economists use the Federal Reserve’s aggregates known as M1 and M2. Gross domestic product, or GDP, is another government statistic that is tricky to measure perfectly, but nominal GDP tends to rise with the

What exactly is being done when shares are bought and sold?

July 8, 2024 No Comments

A: Most stocks are traded on physical or virtual exchanges. The New York Stock Exchange (NYSE), for example, is a physical exchange where some trades are placed manually on a trading floor (other trading activity is conducted electronically). NASDAQ, on the other hand, is a

What inputs are considered to be factors of production?

July 8, 2024 No Comments

A: Factors of production are inputs used to produce an output, or goods and services. They are resources a company requires to attempt to generate a profit by producing goods and services. Factors of production are divided into four categories: land, labor, capital and entrepreneurship. Factors of

What Factors Cause Shifts in Aggregate Demand?

July 8, 2024 No Comments

A: Aggregate demand (AD) is defined as the total amount of goods and services consumers are willing to purchase in a given economy and during a certain period. Sometimes aggregate demand changes in a way that alters its relationship with aggregate supply (AS); this is

What is “marginalism” in microeconomics and why is it important?

July 8, 2024 No Comments

A: “Marginalism” describes both a method of analysis and a theory of value in economics. According to this theory, individuals make economic decisions on the margin; value is determined by how much additional utility an extra unit of a good or service provides. It would

What factors influence a change in demand elasticity?

July 8, 2024 No Comments

A: Demand elasticity is the sensitivity of the demand for a good or service due to a change in another factor. There are many factors that influence a change in demand elasticity. These factors include price, income level and availability of substitutes. Price One factor

What is a “daisy chain”?

July 8, 2024 No Comments

A: A daisy chain is a term used to describe a group of investors who engage in activities that inflate or deflate the price of a stock for the purpose of selling it for profit or buying it cheaply. Daisy chaining involves creating transactions to

What factors influence a change in supply elasticity?

July 8, 2024 No Comments

A: The elasticity of supply measures the percentage change in supply due to a change in another factor. It refers to how the amount supplied of a good or service changes in response to a price or factor change. There are several factors that affect the

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