Understanding Company Costs, Commercial Departments, and Market Research
Company Costs
The cost of production is the value of productive factors used in the production of a good or a service.
Fixed Costs
Those costs independent of output level, i.e., they do not change if you change the quantity produced.
Variable Costs
Those costs that vary with the level of production. In the short term, it’s important to differentiate between fixed and variable factors. However, in the long term, all costs are variable.
Direct Costs
Those costs directly associated with production and that
Read MoreEconomic Policy: Unemployment, Inflation, and Aggregate Demand
Economic Policy Objectives
Item 9 focuses on key economic policy objectives: low unemployment, low inflation, and a low deficit.
Aggregate Demand
Aggregate demand (D) represents the total demand for goods and services in an economy at a given price level. We can distinguish three levels of demand:
- Aggregate Demand (D): The total demand across all markets.
- Market Demand: Demand within a specific market.
- Individual Demand: Demand from a single consumer.
Components of Aggregate Demand
Aggregate demand is composed
Read MoreFinancial Management and Corporate Finance
What is Financial Management?
It achieves the maximization of our income.
What Constitutes Financial Management?
- Analysis of Financial Opportunities: Transforming savings into efficient investments, requiring attention to financial market offerings, seeking minimal risk with maximum utility.
- Managing Money: Adequately accounting for income and expenditure, and properly analyzing ways to keep track of money, are options to raise funds.
- Investments and Assets: Each purchase or investment should mean growth
Macroeconomics: Key Concepts and Indicators
Macroeconomics studies the performance of the entire economy. It deals with the economy as a whole, while microeconomics studies the behavior of individual markets, prices, and products.
Key Macroeconomic Variables
- Gross Domestic Product (GDP): Measures total production.
- Consumer Price Index (CPI): Indicates the evolution of prices and inflation.
- Activity, Unemployment, and Occupancy Rates: Indicate a country’s employment situation.
Economic Indicators
- Controlled inflation allows families to manage their
Understanding Price Formation: Supply and Demand Dynamics
Training Price
Price is the amount of money you must pay to purchase a particular good. In market economies, prices are formed through the interaction of supply and demand, assuming perfect competition. The requirements for perfect competition are:
- A large number of buyers and sellers (no monopoly).
- No single buyer or seller can influence prices independently.
- Buyers and sellers do not act in coalitions to impose prices.
- No price fixing by authorities.
- Full information about traded goods is available.
Forecasting Methods and Techniques for Businesses
Forecasting
Forecasting is predicting or estimating future events.
Forecasts are made on many different variables. Operations and supply chain managers need forecasts to plan output levels, purchases of services and materials, workforce and output schedules, inventories, and long-term capacities.
Demand Patterns
The repeated observations of demand for a service or product in their order of occurrence form a pattern called a time series.
There are five basic patterns of most demand time series:
- Horizontal
- Trend
- Seasonal
- Cyclical
- Random