| Business and Economic Terms-India |
| NAFTA |
North American Free Trade Agreement |
| NASDAQ |
Started in the US, 1971, as an automated over-the-counter security quotes system — the acronym stands for National Association of Securities Dealers' Automated Quotation. NASDAQ evolved into the world's first electronic stock market. |
| Neo-classical theory |
The view that markets operates efficiently and that the way to increase output and employment is to raise aggregate supply. |
| Net asset value (NAV) |
The market value of a fund share, usually calculated daily after the close of trading. |
| North American Free Trade Agreement (NAFTA) |
Free trade agreement involving Canada, the US and Mexico entered into in January 1994. It progressively eliminates almost all bilateral trade barriers between the three countries. |
| OECD |
The Organization for Economic Cooperation and Development. |
| Offer curve of labor |
The number of hours of labor is prepared to work at different levels of income. |
| Oligopolies |
Markets dominated by a few sellers who account for a large proportion of output. |
| Open market operations |
Where the Bank of England sells short-term government securities and bills, thereby reducing retail banks' liquid assets and raising interest rates. |
| Opportunity cost |
The decision to produce or consume a product involves giving up another product; the real cost of an action is the next best alternative forgone. |
| OTC (over the counter) |
Trading in shares away from organized exchanges; it is usually carried out over the telephone or via a computer network. |
| Pareto criteria |
A reallocation of resources is desirable only if someone gains and no one loses. |
| Perfect competition |
An industry made up of a large number of small firms, each selling homogeneous (identical) products to a large number of buyers. |
| Phillips curve |
Shows the relationship between the rate of unemployment and the rate of inflation. |
| Price discrimination |
When the same product is sold in different markets for different prices. |
| Price elasticity of demand |
Measures the responsiveness of demand to a given change in price. |
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| Price elasticity of supply |
Measures the responsiveness of supply to a given change in price. |
| Primary markets |
The placing of new stocks, shares, bonds, etc. Existing securities are traded in the secondary market. |
| Primary sector |
That part of the economy concerned with agriculture and the extraction of raw materials. |
| Producer surpluses |
The difference between the minimum price a producer would accept to supply a given quantity of a good and the price actually received. |
| Progressive income tax |
A tax which takes a higher percentage of the income of the rich than the poor. |
| PSE |
Producer subsidy equivalent (agriculture) |
| PSI |
Pre-shipment inspection |
| Purchasing power parity theory |
Suggests that the prices of goods in countries will tend to equate under floating exchange rates so that people would be able to purchase the same quantity of goods in any country for a given sum of money. |
| Quantity theory of money |
The view that changes in the money supply have a direct and proportionate effect on the price level. |
| Repo rate |
The interest rate at which a central bank will lend against the security of its government's paper. |