chapter 1 Flashcards
occurs when money is transferred one
organization or individual to another.
cash flow
represents the economic effects of an alternative in terms of money spent and received.
cash flow
are those products or services
that are directly used by people to satisfy their wants.
Consumer goods and services
are used to produce consumer
goods and services or other producer goods
Producer goods and services
are those products or services that are required to
support human life and activities, that will purchased in
somewhat the same quantity even though the price varies
considerably.
Necessities
are those products or services that are desired by
humans and will be purchased if money is available after the
required necessities have been obtained
Luxuries
is the quantity of a certain commodity that is bought at
a certain price at a given place and time
Demand
occurs when a decrease in selling price result in
a greater than proportionate increase in sales.
Elastic demand
Inelastic demand
occurs when a decrease in the selling price
produces a less than proportionate increase in sales
occurs when the mathematical
product of volume and price is constant
Unitary elasticity of demand
occurs in a situation where a commodity or
service is supplied by a number of vendors and there is nothing to
prevent additional vendors entering the market.
Perfect competition
is the opposite of perfect competition. exists when a unique product or service is available from
a single vendor and that vendor can prevent the entry of all others
into the market.
Monopoly
exists when there are so few suppliers of a product or
service that action by one will almost inevitably result in similar
action by the others
Oligopoly
is the quantity of a certain commodity that is offered for sale
at a certain price at a given place and time.
Supply
Under conditions of perfect competition the price at which a given
product will be supplied and purchased is the price that will result in
the supply and the demand being equal.
law of supply and demand may be stated as follows:
When the use of one of the factors of production is limited, either
in increasing cost or by absolute quantity, a point will be reached
beyong which an increase in the variable factors will result in a less
than proportionate increase in output
The Law of Diminishing Returns
are those unaffected by changes in activity level over a
feasible range of operations for the capacity or capability
available.
Fixed costs
are those associated with an operation that varies in
total with the quantity of output or other measures of activity
level.
Variable costs
is the additional costs that
results from increasing an output of a system by one (or more) units
Incremental Costs or incremental revenue
are costs that can be resasonably measured and
allocated to a specific outputor work activity.
Direct costs
are costs that are difficult to allocate to a specific
output or work activity.
Indirect costs
consists of plant operating costs that are not direct
labor or direct material costs
Overhead costs
lannedcosts per unit of output that are
established in advanced of actual production or service delivery
Standard costs
involves payment of cash.Are estimated from the
perspective established for the analysis and are the future expenses
incurred for the alternatives being analyzed.
Cash costs
