13 relations: Capital account, Capital appreciation, Currency, Devaluation, Fixed exchange-rate system, Floating exchange rate, Inflation, International trade, Market basket, Marshall–Lerner condition, Purchasing power parity, Revaluation, Speculation.
In macroeconomics and international finance, the capital account (also known as the financial account) is one of two primary components of the balance of payments, the other being the current account.
Capital appreciation is an increase in the price or value of assets.
A currency (from curraunt, "in circulation", from currens, -entis), in the most specific use of the word, refers to money in any form when in actual use or circulation as a medium of exchange, especially circulating banknotes and coins.
In modern monetary policy, a devaluation is an official lowering of the value of a country's currency within a fixed exchange rate system, by which the monetary authority formally sets a new fixed rate with respect to a foreign reference currency or currency basket.
A fixed exchange rate, sometimes called a pegged exchange rate, is a type of exchange rate regime where a currency's value is fixed against either the value of another single currency, to a basket of other currencies, or to another measure of value, such as gold.
A floating exchange rate (also called a fluctuating or flexible exchange rate) is a type of exchange-rate regime in which a currency's value is allowed to fluctuate in response to foreign-exchange market mechanisms.
In economics, inflation is a sustained increase in price level of goods and services in an economy over a period of time.
International trade is the exchange of capital, goods, and services across international borders or territories.
A market basket or commodity bundle is a fixed list of items, in given proportions, used specifically to track the progress of inflation in an economy or specific market.
The Marshall–Lerner condition (after Alfred Marshall and Abba P. Lerner) is the condition that an exchange rate devaluation or depreciation will only cause a balance of trade improvement if the absolute sum of the long-term export and import demand elasticities is greater than unity.
Purchasing power parity (PPP) is a neoclassical economic theory that states that the exchange rate between two countries is equal to the ratio of the currencies' respective purchasing power.
Revaluation is a change in a price of a good or product, or especially of a currency, in which case it is specifically an official rise of the value of the currency in relation to a foreign currency in a fixed exchange rate system.
Speculation is the purchase of an asset (a commodity, goods, or real estate) with the hope that it will become more valuable at a future date.