What is the Industrial Goods Sector? In contrast to the consumer goods sector that produces goods and services directly consumed by households, the industrial goods sector provides capital goods to other businesses for manufacturing and construction. The sub-sectors include aerospace and defense, homebuilding, electric equipment, machinery, construction and engineering, distributors, etc. The industrial goods sector…
What is a Data Lake? A data lake refers to a central storage repository used to store a vast amount of raw, granular data in its native format. It is a single store repository containing structured data, semi-structured data, and unstructured data. A data lake is used where there is no fixed storage, no file…
What is Variance? Variance refers to the expected deviation between values in a specific data set. It measures the spread of each figure from the average value. Traders and market analysts often use variance to project the volatility of the market and the stability of a specific investment return within a period. Mostly, variance is…
What is Supply? Supply is a term in economics that refers to the number of units of goods or services a supplier is willing and able to bring to the market for a specific price. The willingness and ability to bring products to market are influenced by stock availability and the determinants driving supply. Changes…
What is Utility Maximization? Utility maximization is a strategic scheme whereby individuals and companies seek to achieve the highest level of satisfaction from their economic decisions. For example, when a company’s resources are limited, management will implement a plan of purchasing goods or services that provides the maximum benefit. The concept of utility maximization was…
What is Taxation? Taxation refers to the fees and financial obligations imposed by a government on its residents. Income taxes are paid in almost all countries around the world. However, taxation applies to all payments of mandatory levies, including on income, corporate, property, capital gains, sales, and inheritance. Taxation is involuntary; hence it does not…
What are Consumer Surplus and Producer Surplus? Both consumer surplus and producer surplus are economic terms used to define market wellness by studying the relationship between consumers and suppliers. They explain the opportunity cost consumers forego to gain a marginal benefit from buying a good or service. To the producer, it is the willingness and ability…
What is Market Structure? Market structure, in economics, refers to how different industries are classified and differentiated based on their degree and nature of competition for goods and services. It is based on the characteristics that influence the behavior and outcomes of companies working in a specific market. Some of the factors that determine a…
What is a Private Good? A private good is an item that is purchased for the benefit or utility of the buyer. When a person consumes the private good, he/she restricts another party from using it. Generally, a good is expressed as private if there is a rivalry between individuals trying to acquire it and…
What is Cross-Price Elasticity? Cross-price elasticity measures how sensitive the demand of a product is over a shift of a corresponding product price. Often, in the market, some goods can relate to one another. This may mean a product’s price increase or decrease can positively or negatively affect the other product’s demand. Understanding Cross-Price Elasticity…
