parameter

parameter
A quantity which is taken as given in any particular piece of analysis. In comparative statics parameters may change, but such changes are assumed to be externally imposed, and not generated as part of the solution to a problem. The parameters of one piece of analysis may be treated as variables in other contexts. For example, in analysing the behaviour of buyers and sellers in a competitive market, each is assumed to treat price as a parameter which their own actions cannot affect. In analysing the market as a whole, however, price is treated as a variable to be determined.