What is price level?

  • (noun): An index that traces the relative changes in the price of an individual good (or a market basket of goods) over time.
    Synonyms: price index

Price Level

A price level is a hypothetical measure of overall prices for some set of goods and services, in a given region during a given interval, normalized relative to some base set. Typically, a price level is approximated with a price index.

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Some articles on price level:

Reflation
... taxes, seeking to bring the economy (specifically price level) back up to the long-term trend, following a dip in the business cycle ... which can be considered a form of inflation (increase in the price level), is contrasted with inflation (narrowly speaking) in that "bad" inflation is inflation above the long-term trend line, while reflation ... of economic growth where there is long-term growth in the economy and price level, which is widely accepted in economics ...
Commercial Planning - Method Explanation - Tactical Planning - Pricing: Define Price Level
... Description the price of the product has to be defined ... A product price is based on development, production, storage, transport and promotion costs ... The price level must be carefully balanced as shown in figure 2 ...
Price Level - Significance
... If, indeed, a price-level component could be distinguished, then it would be possible to measure the difference in overall prices between two regions or intervals ... growth or contraction could be distinguished from mere price changes by deflating GDP or some other measure ...
AD-AS Model - Aggregate Supply Curve
... case, it shows how much output is supplied by firms at various potential price levels ... The aggregate supply curve (AS curve) describes for each given price level, the quantity of output the firms plan to supply ... the firm will supply whatever amount of goods is demanded at a particular price level during an economic depression ...
Lucas Island Model - Applications of The Model
... Every period will have its unique equilibrium level ... If the money supply is constant and evenly distributed among the old, the price level is assumed to be constant i.e ... when everyone is perfectly informed, the price level and the money supply will be proportional ...

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