Found 104 Articles for General Economics

Introduction: What are Preference Shares? There are two types of shares that are allowed investors to invest in – equity shares and preference shares. Equity and preference shares have some distinct differences and they appeal to different categories of investors. Although equity shares are more common in financial terminologies, preference shares are also liked by many investors. Preference shares are instruments that combine the characteristics of equity shares and debt securities. Like equity shares, they represent ownership of the issuing company and are traded in the stock market. On the other hand, they offer fixed dividends over a certain ... Read More

Introduction In order to operate successfully businesses, need to move products, raw materials, and goods between factories, warehouses, and distribution centers. They also need to move or send finished products to the markets. These movements are broadly called physical distribution in economic terms. Physical distribution involves various channels, including wholesale and eCommerce, and contains components, such as inventory, customer service, materials, order processing, and transportation. Benefits of Physical Distribution Physical distribution plays an important role in modern business practices. Some of the important benefits of physical distribution include the following − Cost Cutting Physical distribution may help to reduce costs ... Read More

Introduction Companies need money and/or assets to start a new venture or expand the existing one. These assets and money that a company owns are known as capital. No company can run successfully without capital. Money is needed in every business aspect while monetary and non-monetary assets help organizations run smoothly. Usually, the term capital is used to indicate physical assets, but nowadays, human capital is also realized as an essential asset for organizations. Human capital comprises the knowledge base and skills of the workforce. Although it is hard to measure human capital directly, the investments made in improving human ... Read More

Introduction: What is Perfect Competition? The term perfect competition is attached to a market condition where − All companies sell similar or the same products There is no barrier for firms to enter the market. Market share of companies does not influence the price Buyers have complete, perfect, or full information Companies cannot determine prices. Simply said, perfect competition refers to a market where the prices are determined by mere demand and supply, and companies cannot determine the prices even if there is no entry barrier for new firms in the market. Perfect competition is more of a ... Read More

Introduction: What is an Outstanding Expense? Outstanding expense refers to expenses that have not been paid by a business yet. Usually, businesses do not pay all expenses when they incur them. Some expenditures are made at the end of the year or at some other decided time. These expenses are known as outstanding expenses. As is clear from the above note, outstanding expenses are liabilities that the business must pay at a given time. Businesses keep account of these expenses so that they can meet their expenses in due course of time. There are some select methods of keeping ... Read More

Introduction: What is Organic Farming? Organic farming is an agricultural system based on ecologically based pest controls and biological fertilizers. These fertilizers used in organic farming are derived chiefly from animal and plant wastes and nitrogen fixation obtained by using special crops. Present- day organic farming is a response to the environmental harm caused by the use of chemical pesticides and synthetic fertilizers. These chemicals and harmful fertilizers were used largely in conventional agriculture previously, and replacing them has many ecological benefits. In comparison to conventional agriculture, organic farming utilizes less amount of pesticides, decreases nitrate from leaking into ... Read More

Introduction: What is an Opening Entry in Economics? An opening entry is the record of a previous balance sheet that is recorded newly in a new balance sheet. Usually, when a new accounting period begins, the older records are used as the new entry to start in the new balance sheet. This is known as an opening entry. In general, to open the books of accounts, the journal entry is taken at the beginning of the new accounting period. It helps in transferring the balances in the ledger accounts and is called an opening entry. As is obvious, the opening ... Read More

Introduction Occupational structure refers to the framework of different occupations that build up the economy of a nation. Usually, in an economy, people are engaged in various professions in different proportions. All these professions make up the occupational structure of an economy. The occupational structure of different nations varies greatly in terms of professions. While developing nations like India have a considerable population engaged in agriculture, the share of technology and research is prevalent greatly in richer countries like the United States of America. Learning about the occupational structure of a country is important for various reasons. It shows whether ... Read More

Introduction Depending on the choice of customers to buy products when their prices go up or down, goods are categorized into two types - Normal and Inferior goods. Identifying the goods as normal or inferior helps companies judge the forthcoming demand and this may help them set strategic decisions according to the nature of the products. In general, there are many commonalities between normal and inferior goods. However, there are some distinct differences too. What are Normal goods? Normal goods are products whose demand in the market increases with the rising income levels of the customers. In other words, when ... Read More

Introduction: What is Opportunity Cost? Investors usually have more than one investment option but have to choose only one while leaving all other options. In this process, the investor has to lose the gain of the next best alternative. This potential loss an investor faces or the gain that is missed out for choosing one alternative to the next best one is known as the opportunity cost. Therefore, we may say that the value lost while choosing one option leaving the next best one is the opportunity cost. Investors choose an investment option thinking that it will provide the best ... Read More