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Also called resource cost advantage. The ability of a party (whether an individual, firm, or country) to produce a greater quantity of a good, product, or service than competitors using the same amount of resources. absorption The total demand for all final marketed goods and services by all economic agents resident in an economy, regardless of the origin of the goods and services themselves ...
In common usage, "significant" usually means "noteworthy" or "of substantial importance". In econometrics—the use of statistical techniques in economics—"significant" means "unlikely to have occurred by chance". For example, suppose one wishes to find if the minimum wage rate affects firms' decisions on how much labor to hire. If the data ...
Variable monthly expenses. These expenses fluctuate from month to month and are often discretionary in nature. Examples include groceries, utilities, entertainment expenses and travel. Variable ...
Expenses that are included in COGS cannot be deducted again as a business expense. COGS expenses include: The cost of products or raw materials, including freight or shipping charges; The direct labor costs of workers who produce the products; The cost of storing products the business sells; Factory overhead expenses.
A professional investor contemplating a change to the capital structure of a firm (e.g., through a leveraged buyout) first evaluates a firm's fundamental earnings potential (reflected by earnings before interest, taxes, depreciation and amortization and EBIT), and then determines the optimal use of debt versus equity (equity value).
An expense report is a form of document that contains all the expenses that an individual has incurred as a result of the business operation. For example, if the owner of a business travels to another location for a meeting, the cost of travel, the meals, and all other expenses that he/she has incurred may be added to the expense report.
The bookkeeper or accountant must itemise and allocate revenues and expenses properly to the specific working scope and context in which the term is applied. Net income is usually calculated per annum, for each fiscal year. The items deducted will typically include tax expense, financing expense (interest expense), and minority
Research and development (R&D) is a typical example of economies of scope. In R&D economies, unit cost decreases because of the spreading R&D expenses. For example, R&D labs require a minimum number of scientists and researchers whose labour is indivisible. Therefore, when the output of the lab increases, R&D costs per unit may decrease. The ...