Archives: Terms

Definition of Prices and Incomes Policy Prices and Incomes Policy refers to government strategies aimed at controlling inflation by directly managing wage increases and price rises. Unlike traditional economic measures such as monetary or fiscal policy, prices and incomes policies attempt to restrain inflation through regulations or agreements that directly […]

Definition of Price-Wage Spiral The price-wage spiral is an economic concept that describes the cause-and-effect relationship between rising wages and rising prices, commonly seen during periods of inflation. It starts when workers demand higher wages to keep up with increasing living costs. When employers meet these demands, their costs of […]

Definition of Price-Setter A price-setter is an individual, company, or entity that has the ability to determine the price of a product or service in the market. Unlike price-takers, who must accept the market price as given, price-setters exert a significant amount of control over their pricing decisions due to […]

Definition of Price-Sensitive Information Price-sensitive information refers to any information that can significantly impact the price of a company’s securities. This type of information is also known as “material information.” It includes company-specific details that, if disclosed, would influence investors’ decisions to buy, sell, or hold securities. The timely and […]

Definition of Price-Maker A price-maker is an entity, typically a firm, that has the power to influence the price of the goods or services it sells. Unlike price-takers, who must accept the market price determined by the forces of supply and demand, price-makers have some degree of monopoly power and […]

Definition of Price-Earnings Ratio The Price-Earnings (P/E) Ratio is a financial metric used to evaluate the valuation of a company’s stock. It is calculated by dividing the market value per share by the earnings per share (EPS). The P/E ratio signifies how much investors are willing to pay for a […]

Definition of Price Volatility Price volatility refers to the degree of variation in the price of a financial instrument over time. It is measured by the standard deviation or variance between returns from that same security or market index. Essentially, it represents the frequency and magnitude of price movements from […]

Definition of Price Support Price Support is a government intervention in the market to stabilize or increase prices of essential goods and services by setting minimum prices, purchasing surpluses, or providing subsidies to producers. This mechanism is commonly used in agricultural markets to protect farmers from price volatility and ensure […]

Definition of Price Stability Price stability refers to the economic condition where prices in the economy do not change much over time. It means that the purchasing power of money remains relatively constant, with low and stable inflation rates. When prices are stable, businesses and consumers can make long-term financial […]

Definition of Price Squeeze Price squeeze, also known as margin squeeze, occurs when a vertically-integrated company, which both produces an essential input and competes in the downstream market, sets the price of the input in such a way that competitors in the downstream market cannot compete effectively. This often involves […]