purchasing power

purchasing power definition - finance
  1. The amount of goods or services that a defined amount of money can buy. Purchasing power can be used as a proxy for measuring inflation. As inflation rises, purchasing power erodes.
  2. How much money someone can invest in a stock or financial market by using the maximum margin (amount of money that can be loaned) that the brokerage firm makes available.

Webster's New World Finance and Investment Dictionary Copyright © 2003 by Wiley Publishing, Inc., Indianapolis, Indiana.
Used by arrangement with John Wiley & Sons, Inc.

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