What is Temporary and Permanent Fiscal Policy? A temporary tax cut or spending increase will explicitly last only for a year or two, and then revert to its original level. A permanent tax cut or spending increase is expected to stay in place for the foreseeable future. The effect of temporary and permanent fiscal policies on aggregate demand can be ...

What are the Benefits of a Business Degree? A business degree creates a signaling function to employers that entails the following benefits: Formal Credentials Exposure to Knowledge Talent or Skills General Intelligence Diligence or Work Ethic Fit (Beliefs, Interests, Values) Formal Credentials When seeking a management position or professional serv...

Utility Patent: Do You Need One? A utility patent is often the most valuable asset of a many startup ventures. Patent rights are granted by the United States Government (specifically, the United States Patent and Trademark Office). They grant the patent holder the right to prevent others from copying and commercially distributing their covered inven...

What is a Growth Curve? A growth curve is a graphical representation of the increase in a particular quantity over time.  Growth curves can be typically classified into two types - Exponential growth curve, or, J Curve. Logistic growth curve, or S Curve. A growth curve has different applications in different fields of study. Growth curves are extens...

What is the Heckscher-Ohlin Model? The Heckscher-Ohlin model, otherwise known as the H-O model or 2x2x2 model, is a mathematical theory used in international trade to evaluate the export pattern of a country relative to the natural resources at their disposal.  The model explains how resources are imbalanced throughout the world. It assumes that it ...

What is Capitalization Rate? A capitalization rate, or cap rate, is used by real estate investors to evaluate an investment property and show its potential rate of return, helping the investor decide if she should purchase the property. The formula is: Net Income / Total cost of acquisition Net Income = Revenue - Operating expenses This indicator is...

What are Issued Shares? Issued shares refer to the totality of a company's shares that have been issued or allocated to the company's shareholders, this number of shares are recorded in the company's annual report. Issued shares are shares of a company that have been given to shareholders either as a form of compensation or during issuance of shares...

What is the Inventory Turnover Ratio? Inventory turnover, also known as Sales Turnover, is a metric representing the rate at which a company sells its inventory and replaces it in a given period.  Inventory Turnover Ratio = COGS / Average Inventory This metric is calculated by dividing the number of goods or cost of goods sold by the average invento...

What is a Prospectus? A legal document in accordance with Securities and Exchange Commission (SEC) guidelines, provided to investors before the issuing of securities - stocks or mutual funds, is called a Prospectus. It includes details about the issuing firms financial and operational data, information on major stakeholders, details about the number...

What is Penetration Pricing? Penetration pricing refers to a marketing strategy utilized by businesses for attracting customers to a brand new product or service. Penetration pricing involves offering a low price for a new product or service during its first offering. The lower price assists in luring customers away from competitors. A marketing str...