Supply and Demand
What are the Laws of Supply and Demand? The laws of supply and demand are microeconomic concepts that state that in efficient markets, the quantity supplied of a good and quantity demanded of that good are equal to each other. The price of that good is also determined by the point at which supply and...
Capitalism
What is Capitalism? Capitalism is an economic system that allows for and encourages the private ownership of businesses that operate to generate profit. Also known as the market system, capitalism is characterized by private land ownership rights, competitive markets, the stable rule of law, freely operating capital markets, low corruption, and a price discovery process....
Hard vs Soft Commodities
What are Hard vs Soft Commodities? Before we discuss hard vs soft commodities, let us discuss what a commodity is. The term commodity is an umbrella term for economic goods that are fungible, i.e., can be freely brought and sold. The commodities produced by a country include the raw materials and/or primary agricultural products mined,...
Monetary Policy
What is Monetary Policy? Monetary policy is an economic policy that manages the size and growth rate of the money supply in an economy. It is a powerful tool to regulate macroeconomic variables such as inflation and unemployment. These policies are implemented through different tools, including the adjustment of the interest rates, purchase or sale...
Foreign Direct Investment (FDI)
What is Foreign Direct Investment (FDI)? Foreign direct investment (FDI) is an investment from a party in one country into a business or corporation in another country with the intention of establishing a lasting interest. Lasting interest differentiates FDI from foreign portfolio investments, where investors passively hold securities from a foreign country. A foreign direct investment...
