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The real interest rate is the rate of interest an investor, saver or lender receives (or expects to receive) after allowing for inflation. It can be described more formally by the Fisher equation, which states that the real interest rate is approximately the nominal interest rate minus the inflation rate. If, for example, an investor were able ...
Time preference. In economics, time preference (or time discounting, [ 1] delay discounting, temporal discounting, [ 2] long-term orientation[ 3]) is the current relative valuation placed on receiving a good or some cash at an earlier date compared with receiving it at a later date. [ 1]
Rational expectations is an economic theory that seeks to infer the macroeconomic consequences of individuals' decisions based on all available knowledge. It assumes that individuals actions are based on the best available economic theory and information, and concludes that government policies cannot succeed by assuming widespread systematic ...
Barnum effect. The Barnum effect, also called the Forer effect or, less commonly, the Barnum–Forer effect, is a common psychological phenomenon whereby individuals give high accuracy ratings to descriptions of their personality that supposedly are tailored specifically to them, yet which are in fact vague and general enough to apply to a wide ...
The neutral rate of interest, previously called the natural rate of interest, [ 1] is the real (net of inflation) interest rate that supports the economy at full employment /maximum output while keeping inflation constant. [ 2] It cannot be observed directly. Rather, policy makers and economic researchers aim to estimate the neutral rate of ...
Fisher equation. In financial mathematics and economics, the Fisher equation expresses the relationship between nominal interest rates, real interest rates, and inflation. Named after Irving Fisher, an American economist, it can be expressed as real interest rate ≈ nominal interest rate − inflation rate. [1] [2]
Observational methods in psychological research entail the observation and description of a subject's behavior. Researchers utilizing the observational method can exert varying amounts of control over the environment in which the observation takes place. This makes observational research a sort of middle ground between the highly controlled ...
62532514. The General Theory of Employment, Interest and Money is a book by English economist John Maynard Keynes published in February 1936. It caused a profound shift in economic thought, [ 1] giving macroeconomics a central place in economic theory and contributing much of its terminology [ 2] – the "Keynesian Revolution".