Definition: In Marginal Costing, we study the impact of variable cost at distinctive levels of production capacity for that we need to divide the total cost into fixed and variable cost because the fixed cost does not make any impact on marginal cost. However, fluctuations in variable cost in different production capacities are known as the marginal cost for the … [Read more...] about Marginal Costing
Monopoly
Definition: Monopoly is one of the extreme imperfect markets amongst Monopoly, Monopolistic Competition and Oligopoly as it lacks several characteristics of perfect competition and it exists where a single firm rules the industry. The word Monopoly is a combination of two words in which “mono” implies “single” and “poly” means “seller”. Therefore, the market controlled by a … [Read more...] about Monopoly
Hedging
Definition: Hedging means limiting something by certain conditions in general terms; however, in financial terminology, hedging is a process of protecting oneself against any loss in investment, i.e., it is a method of using market instrument tactically to compensate any unfavourable movements of prices, or we can say the investor hedge one investment by hedging … [Read more...] about Hedging
Municipal Bond
Definition: Municipal Bond are the bonds which are issued by the local government or agencies to complete their minor projects or to complete the public welfare work for which finance is required, a government issues a certificate consisting of its worth and also provides interest on such certificates to the holders of Municipal Bonds. A general example for which the local … [Read more...] about Municipal Bond
Endorsement
Definition: Endorsement comes under the Negotiable Instrument Act, 1881. It is a process of affirming the negotiable instrument signed by the drawer (the endorser) for the reason of negotiation, and the receiver of the instrument is known as a drawer (endorsee). The instrument must be signed by the drawer either in front or backside, and if there is no remaining space in … [Read more...] about Endorsement
Arbitration
Definition: Arbitration is a procedure of making a decision by an outsider for a dispute settlement between two parties. In this process, the arbitrator makes an impartial decision that will become mandatory for both parties to follow. Here, the arbitrator is an individual appointed to resolve the disputes and differences of two parties. The arbitrator makes his decision on the … [Read more...] about Arbitration
Micro Finance
Definition: Micro Finance is somehow like a banking facility that offers financial services to small scale businessmen’s or to unemployed individuals who are in need of funds, i.e., it is the provision of small scale financial services to low-income persons. The term generally signifies small loans given to the clients for self-employment. As in previous times, low-income … [Read more...] about Micro Finance
Fixed Cost
Definition: Fixed cost is a cost that does not change with an increase or decrease in the number of goods and services produced. It is one of the two components of the total cost of goods and services along with the variable cost. These costs are applicable to all businesses doing any kind of business. In economics, a business can achieve economies of scale when it produces … [Read more...] about Fixed Cost
Business Cycle
Definition: Business cycle also termed as trade cycle displays the ebbs and flows of the economic activities occurring regularly, i.e., it shows the fluctuation movements or rhythmical changes in the level of aggregate economic activity. In other words, business cycle is the fluctuation cycle of economic activities that are more or less regular in time sequence. The level of … [Read more...] about Business Cycle
Marketing Audit
Definition: Marketing Audit is an overall analysis of a company’s marketing strategies and objectives in a systematic manner so as to find out the problematic areas and opportunities and urging a plan to improvise the company’s marketing performance. It is essential as it analyzes the external and internal situations. It is also going to analyze the past performance and the … [Read more...] about Marketing Audit