The words 'expenses' and 'expenditure' are commonly used as synonyms, but there is a fine line of differences between them. While expense refers to the amount spent on the production or selling of the goods and services, so as to generate revenue, expenditure implies any type of disbursement of funds made by the enterprise. While expense denotes consumption of cost, expenditure indicates outlay of funds. It is worth noting that expenditure is a broad term that covers expenses. Further, the … [Read more...]

National Income, as the name suggests is the income of a nation, measured in terms of production, during the course of a financial year. Hence, when the production is represented in terms of final goods and services, it is called a National Product, whereas when it is represented in monetary terms, it is National Income. It tends to determine the quantum of economic activity carried out during the course of an accounting period. Contrarily, Domestic Income implies the summation of the factor … [Read more...]

In common parlance, supply means making something available or providing something. In economics, supply is used in the context of goods, it means the quantity of goods offered for sale by the producer, in the market at a given price and time. It is often contrasted with stock, which refers to the excess of goods present in the market over the goods supplied. While supply is obtained from stock, the stock is the result of production. In other words, the total quantity of finished goods … [Read more...]

When the management refuses to accept the demands of the employees or workers, due to which they mutually decide to stop working, and proceed to strike. Workers used this as a last option when they don't find any other way to convince the management, to agree to their demands. Talking about the other way round, when the employers are looking for domination over the workers and impose their terms and conditions on them, they keep them out of the business premises and stop them from performing … [Read more...]

In simple words, the standard of living implies the level of welfare provided to the residents of a country, i.e. it may refer to all those goods and services that people are able to consume and the resources they can access. On the contrary, quality of life indicates the welfare and well being of a person or group. Standard of Living is a quantifiable term, in the sense that it takes into account only material factors. As against, quality of life is a subjective assessment of how satisfied … [Read more...]

Factor Income refers to the income of means of production such as rent, wages, interest and profit, which accrues to land, labour, capital and entrepreneur, respectively. On the other hand, Transfer Income are the incomes which are not received by the person in the form of rewards for the services rendered, i.e. there is the transfer of money without the exchange of goods or services, National Income is the summation of all factor incomes earned by the country's residents during the period of … [Read more...]

The literal meaning of the word 'oligopoly' is 'competition among few'. Collusive Oligopoly is when the oligopolists come in formal or informal agreement with one another to avoid competition among themselves. On the other hand, in a non-collusive oligopoly, the firms tend to compete with each other, by setting their own price and output policy, which is independent of the other firms. What is Oligopoly? Oligopoly is a type of market characterised by a few firms offering either homogeneous … [Read more...]

Based on the number of consumers, demand is classified as individual demand and market demand. Individual demand implies, the quantity of good or service demanded by an individual household, at a given price and at a given period of time. For example, the quantity of detergent purchased by an individual household, in a month, is termed as individual demand. Unlike Market Demand implies the sum total of all individual demand for the commodity at each possible price, over a period of time. For … [Read more...]

We all know that demand for a product is mainly affected by its price, but there are some other factors which can also affect its demand. One such factor is 'Price of Related goods', wherein the term 'related goods' means complements and substitutes. In simple words, Complementary Goods are the goods that complete each other. This means that such goods are used in conjunction with one other, which enhances their value. In other words, these goods have no value when they are consumed alone. On … [Read more...]

The consumer has a limited income, that acts as a constraint to his/her maximizing behaviour, i.e. the budget constrains how much the consumers can consume. While budget line graphically represents the bundle of two goods which a consumer can buy with the given budget. As against, all the combinations in the positive quadrant, which lie on or below the budget line are called a budget set. You might have come across the term 'budget' at least once in your life. To know what quantities of two … [Read more...]