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Q: please define an "output gap"

Category: glossary , Asked by: X. X. From United States

A: An economic measure of the difference between the actual output of an economy and the output it could achieve when it is most efficient, or at full capacity. There are two types of output gaps: positive and negative. A positive output gap occurs when actual output is more than the full-capacity output. Negative output gap occurs when actual output is less than full-capacity output. The measure compares the actual GDP (output) of an economy and the potential GDP (efficient output). When the economy is running an output gap, either positive or negative, it is thought to be running at an inefficient rate as the economy is either overworking or underworking its resources. Economic theory suggests that positive output gap will lead to inflation as production and labor costs rise. Visit MoneyForex

Q: please tell me what a "naked option" is
Category: glossary , Asked by: Titus L. From United States

A: An option position where the buyer or seller has no underlying security position. Naked options are very risky. Profits are huge if the underlying asset moves in the direction desired by the investor. On the other hand, a writer of a naked option can lose big if the underlying asset moves in the opposite direction.
Q: please define "commercial paper"
Category: glossary , Asked by: I. G. From Canada

A: a "commercial paper " is A short-term, discounted, unsecured note issued by banks and corporations with shorter maturities than certificates of deposit, typically around 30 days. Such notes are a negotiable instruments in bearer form.
Q: do you know what "coupon pass" is?
Category: glossary , Asked by: Lola S. From Colorado Springs, United States

A: The purchase of treasury notes or bonds from dealers, by the Federal Reserve. The "coupon" refers to the coupons which are the main difference between T-notes and T-bills. The "pass" comes from when the Federal Reserve buys T-bills from dealers thus passing the bill.

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Q: please define an "output gap"

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