Wealth, Microeconomics

Wealth: This is a stock of accumulated purchasing power stored up from the past.

For example, if you have a fat savings account accumulated from your past earnings, your current spending may be greater than your current income. This implies that what actually determines consumption is not nominal wealth but real wealth, which takes the price level into account.

Expectations: Households` expectations concerning future prices, money income and the availability of goods may have a significant impact on their current spending. Expectations of rising prices and product shortages tend to trigger more spending and less saving, that is, it shifts the consumption function upward and the saving function downward.

Posted Date: 1/3/2013 12:13:06 AM | Location : United States

Related Discussions:- Wealth, Assignment Help, Ask Question on Wealth, Get Answer, Expert's Help, Wealth Discussions

Write discussion on Wealth
Your posts are moderated
Related Questions
The Schrodinger wave equation generalizes the fitting-in-of-waves procedure. The waves that "fit" into the region to which the particle is contained can be recognized "by inspect

Comparative Advantage:A theory of international trade which originated with David Ricardo in early 19th Century and is maintained (in revised form) within neoclassical economics. T

what is microeconomics

what is pooling equilibrium

I am concerned that if we get into price war with Everest Solution

reason for kinked demand curve

I need help on MCQs on international trade and imperfect competetion

This problem continues the analysis from question 2. a.Another economic study finds that the marginal cost (MC) to farmers of nutrient runoff abatement is MC = .1Q. Graph this f

explain how a perfact market responds to changes in consumer demand?