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 picture info Purchasing Power Parity Purchasing power parity (PPP)[1] is a measurement of prices in different countries that uses the prices of specific goods to compare the absolute purchasing power of the countries' currencies. In many cases, PPP produces an inflation rate that is equal to the price of the basket of goods at one location divided by the price of the basket of goods at a different location. The PPP inflation and exchange rate may differ from the market exchange rate because of poverty, tariffs, and other transaction costs. Purchasing power parity is an economic term for measuring prices at different locations. It is based on the law of one price, which says that, if there are no transaction costs nor trade barriers for a particular good, then the price for that good should be the same at every location.[1] Ideally, a computer in New York and in Hong Kong should have the same price [...More Info...]       [...Related Items...] Capital Asset A capital asset is defined to include property of any kind held by an assessee, whether connected with their business or profession or not connected with their business or profession. It includes all kinds of property, movable or immovable, tangible or intangible, fixed or circulating. Thus, land and building, plant and machinery, motorcar, furniture, jewellery, route permits, goodwill, tenancy rights, patents, trademarks, shares, debentures, securities, units, mutual funds, zero-coupon bonds etc. are capital assets. A well-known financial accounting textbook[6] advises that the term be avoided except in tax accounting because it is used in so many different senses, not all of them well-defined. For example it is often used as a synonym for fixed assets[7] or for investments in securities.[6] However this advice is questionable beyond the US private context [...More Info...]       [...Related Items...] Geometric Mean In mathematics, the geometric mean is a mean or average, which indicates the central tendency or typical value of a set of numbers by using the product of their values (as opposed to the arithmetic mean which uses their sum). The geometric mean is defined as the nth root of the product of n numbers, i.e., for a set of numbers x1, x2, ..., xn, the geometric mean is defined as For instance, the geometric mean of two numbers, say 2 and 8, is just the square root of their product, that is, ${\displaystyle {\sqrt {2\cdot 8}}=4}$ [...More Info...]       [...Related Items...] picture info Price Index A price index (plural: "price indices" or "price indexes") is a normalized average (typically a weighted average) of price relatives for a given class of goods or services in a given region, during a given interval of time. It is a statistic designed to help to compare how these price relatives, taken as a whole, differ between time periods or geographical locations. Price indices have several potential uses. For particularly broad indices, the index can be said to measure the economy's general price level or a cost of living. More narrow price indices can help producers with business plans and pricing [...More Info...]       [...Related Items...] Food Prices Food prices refer to the average price level for food across countries, regions and on a global scale.[1] Food prices have an impact on producers and consumers of food. Price levels depend on the food production process, including food marketing and food distribution. Fluctuation in food prices is determined by a number of compounding factors.[2] Geopolitical events, global demand, exchange rates,[3] government policy, diseases and crop yield, energy costs, availability of natural resources for agriculture,[4] food speculation,[5][6][7] changes in the use of soil and weather events have a direct impact on the increase or decrease of food prices.[8] The consequences of food price fluctuation are multiple [...More Info...]       [...Related Items...] picture info Mexican Peso The Mexican peso (sign: $; code: MXN) is the currency of Mexico. Modern peso and dollar currencies have a common origin in the 15th–19th century Spanish dollar, most continuing to use its sign, "$".[1] The Mexican peso is the 15th most traded currency in the world, the third most traded currency from the Americas (after the United States dollar and Canadian dollar), and the most traded currency from Latin America.[2] The current ISO 4217 code for the peso is MXN; prior to the 1993 revaluation (see below), the code MXP was used. The peso is subdivided into 100 centavos, represented by "¢". As of 21 May 2020, the peso's exchange rate was $25.07 per euro and$22.89 per U.S [...More Info...]       [...Related Items...] picture info Speculation Speculation is the purchase of an asset (a commodity, goods, or real estate) with the hope that it will become more valuable in the near future. In finance, speculation is also the practice of engaging in risky financial transactions in an attempt to profit from short term fluctuations in the market value of a tradable financial instrument—rather than attempting to profit from the underlying financial attributes embodied in the instrument such as value addition, return on investment, or dividends. Many speculators pay little attention to the fundamental value of a security and instead focus purely on price movements. Speculation can in principle involve any tradable good or financial instrument [...More Info...]       [...Related Items...] picture info Real GDP Real gross domestic product (real GDP for short) is a macroeconomic measure of the value of economic output adjusted for price changes (i.e. inflation or deflation).[1] This adjustment transforms the money-value measure, nominal GDP, into an index for quantity of total output. Although GDP is total output, it is primarily useful because it closely approximates the total spending: the sum of consumer spending, investment made by industry, excess of exports over imports, and government spending. Due to inflation, GDP increases and does not actually reflect the true growth in an economy. That is why the GDP must be divided by the inflation rate (raised to the power of units of time in which the rate is measured) to get the growth of the real GDP [...More Info...]       [...Related Items...]