Archives: Terms

Definition of Engineering Economics Engineering Economics, also known as Engineering Economy, is a subset of economics concerned with the use and application of economic principles in the analysis of engineering decisions. It involves the evaluation of the costs and benefits of projects, products, and technologies to determine their economic feasibility […]

Definition of Engel Curve An Engel curve illustrates the relationship between an individual’s income and their expenditure on a particular good, holding all other factors constant. Essentially, it shows how changes in income affect the demand for a product. Engel curves can either slope upwards, indicating that as income increases, […]

Definition of Energy Modeling Energy modeling refers to the process of creating computer-based simulations of a building or complex to analyze or predict energy consumption, utility bills, life cycle costs, and emission levels. These models are designed to simulate the energy behavior of architectural structures based on physical principles and […]

Definition of Ellsberg Paradox The Ellsberg Paradox is a phenomenon observed in decision theory and behavioral economics that highlights people’s aversion to ambiguity and uncertainty. Named after economist Daniel Ellsberg, who first illustrated the concept in 1961, this paradox demonstrates how individuals prefer to make decisions based on known probabilities […]

Definition of Elliott Wave Principle The Elliott Wave Principle is a form of technical analysis that finance traders use to analyze financial market cycles and forecast market trends. It is named after Ralph Nelson Elliott, who discovered that stock markets, thought to behave in a somewhat chaotic manner, actually didn’t. […]

Definition of Elasticity of Substitution Elasticity of substitution is a concept in economics that measures the ease with which one factor of production (like capital or labor) can be substituted for another in the production process without affecting output levels. It reflects how readily businesses can switch between different inputs […]

Definition of Elasticity of Intertemporal Substitution (EIS) The Elasticity of Intertemporal Substitution (EIS) is a measure used in economics to describe how much individuals are willing to substitute consumption over different time periods in response to changes in the rate of return on savings. Essentially, it quantifies the willingness of […]

### Definition of Elasticity of Complementarity Elasticity of complementarity measures the responsiveness of the demand for one good to a change in the price of another good that is a complement to it. In simpler terms, it examines how the purchase quantity of one product might increase or decrease in […]

Definition of Elastic Demand Elastic demand refers to a situation where the quantity demanded of a good or service significantly changes in response to a change in its price. In other words, if the price of a product decreases, the quantity demanded for that product increases substantially, and conversely, if […]

Definition of Efficient Market Hypothesis (EMH) The Efficient Market Hypothesis (EMH) is a financial theory stating that asset prices fully reflect all available information. According to EMH, stocks always trade at their fair value on stock exchanges, making it impossible for investors to either purchase undervalued stocks or sell stocks […]