purchasing power

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Purchasing power

The amount of credit available for securities trading in a margin account, after taking margin requirements into consideration.

Purchasing Power

1. The value of a currency expressed as the amount of goods or services one unit of the currency can buy. Purchasing power is important to inflation, as the higher an inflation rate is, the fewer goods and services one unit of a currency can buy. To measure purchasing power, one must compare it with an objective standard; that is, one might compare how much one dollar can buy now versus how much it could buy 10 year ago. See also: CPI, Purchasing power parity.

2. The dollar amount of securities one can buy on a margin account. Different jurisdictions have different rules on how to measure purchasing power.

purchasing power

1. Consumer ability to purchase goods and services. Increased purchasing power represents proportionately larger increases in income than increases in the cost of goods and services.
2. The ability to purchase goods and services with a fixed amount of money. Within this narrower application, purchasing power is inversely related to the consumer price index. Increased purchasing power is a signal that future increases in economic activity are likely.

purchasing power

the amount of goods and services which can be purchased by a specified sum of money, given the prices of those goods and services. The greater the quantity of products which can be bought with, say, £20, the greater is the purchasing power of that sum of money. If prices go up (INFLATION), however, then purchasing power will fall. What is important for people and business is the long-run relationship of prices and the amount of money they have available to spend. If prices double, for example, but because people's wages are INDEX-LINKED, (i.e. related to a PRICE INDEX), wages also double, then purchasing power remains unchanged.

purchasing power

the extent to which a given monetary unit can buy goods and services. The greater the amount of goods and services purchased with, say, £10, the greater is its purchasing power. Purchasing power is directly linked to the RETAIL PRICE INDEX and can be used to compare the material wealth of an average individual from a previous time period with the present. See INFLATION, PURCHASING-POWER PARITY THEORY.
References in periodicals archive ?
29 while the real value or purchasing power of the country's lowest minimum pay of P265 a day in the Autonomous Region in Muslim Mindanao (ARMM) is reduced to only P152.
Purchasing Power, LLC, is one of the fastest-growing voluntary benefit companies in the industry, offering a employee purchase program for consumer products and services as well as providing financial tools and resources to improve employee financial wellness.
Lazard Middle Market LLC acted as the lead financial advisor and Jefferies LLC also served as a financial advisor to Purchasing Power.
There is still a large gap between net incomes in Europe: Inhabitants of Liechtenstein, the country with the highest purchasing power, have almost eighty times as much purchasing power per person as inhabitants of the Ukraine, which has the lowest purchasing power in Europe.
The riyal's purchasing power during 2000-2013 reduced by 35.
According to the GfK survey, in 2010/2011, the index for Bulgaria is decreasing, in comparison to last year, while the average purchasing power index for the other EU member states is increasing.
In the past year, fiscal and social policy had a positive effect on Austrians' purchasing power and helped create a stable consumer confidence, commented Peter Voithofer, director of KMU Forschung.
Using a real exchange rate to judge whether the dollar is overvalued or undervalued, however, requires some reference point at which purchasing power parity holds.
Moy's statement ignores the fact that it was the government that took advantage of the American taxpayer by destroying the currency's purchasing power to such an extent that the metal in nickels and pennies is now worth more than the coins' face value.
The report urges higher ed leaders to find new ways to control costs, saying tuition should grow no faster than median family income: "Even with significant additional federal investment, there is little chance of restoring the Pell's purchasing power if tuition increases absorb most or all of the new money.
Purchasing power in Italy has fallen 14 per cent, while Germany is down 13 per cent, France down 12 per cent and Greece down 11 per cent.

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