Demand Management and Forecasting: Key Concepts and Applications
Demand Management vs. Forecasting
The primary difference between demand management and forecasting: Demand management is proactive, while forecasting attempts to predict.
Economic Order Quantity (EOQ)
Alpha Company places 10 orders per year with its supplier. Each order is for an amount exactly equal to the EOQ: $500
Strategic Demand Planning
Strategic demand planning would best be utilized: To decide whether or not to close a manufacturing plant.
Forecasting Model Performance
Zanda Corp. has been testing
Read MoreAccounting Principles: Fixed Assets, VAT, and Financial Instruments
Accounting Principles: Key Concepts
Here’s a breakdown of key accounting principles related to fixed assets, VAT, and financial instruments:
Depreciation of Fixed Assets
The function of depreciation for a fixed asset is to systematically and irreversibly allocate the initial expenditure over its useful life.
Intangible vs. Tangible Fixed Assets
False Statement: Only tangible fixed assets are involved in the company’s production process.
Costs Incurred and Tangible Asset Value
Costs incurred on tangible
Understanding Equities: Primary, Secondary Markets & Shareholder Rights
Understanding Equities and Their Characteristics
Unlike fixed income investments, equities do not guarantee a specific return. Instead, equity holders receive a portion of the company’s profits. The most common type of equity is shares, representing over 90% of the variable income market.
A key feature of equities is that they grant the owner membership in the entity. This membership comes with statutory rights, including the right to participate and vote at General Meetings.
Primary Market: Issuing
Read MoreUnderstanding Productivity, Efficiency, and Inventory Management
Productivity and Efficiency Indicator
The indicator used to measure the efficiency of a company’s productivity is a concept similar to performance and is defined by the ratio of production during a period and the factors used to obtain them.
Productivity = Output Obtained / Factors Used
As we refer to a particular factor or all factors, there are two types of productivity indicators:
- Productivity of a factor: Relates the yield obtained with one factor, usually labor.
PT = Production Achieved / Factors
Read MoreUnderstanding HDI, GNH, GDP, Trade, and Economic Factors
Understanding Key Economic Indicators and International Trade
Human Development Index (HDI)
The UN created the HDI to assess the development of countries, not just by GDP, but also by people’s level of literacy and life expectancy. This takes into account the GDP per capita index, education index, and life expectancy index.
Gross National Happiness Index (GNH)
Which country decided to base its policies on the Gross National Happiness Index instead of the GDP?
Bhutan’s principles have been set in policy
Read MoreUnderstanding Supply and Demand in Market Economies
Supply and Demand
Supply and Demand: These are the forces that make market economies work, determining the quantity (Q) of each commodity produced and its selling price. It’s about the behavior of individuals as they interact in markets.
Price
Price: The price of a good represents its exchange value in terms of money; that is, the number of currency units required in exchange for one unit of the good. Price provides information and incentives.
Market
Market: A group of buyers and sellers of a good or
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