What is Horizontal Integration? Horizontal integration is a competitive strategy where business entities operating at the value chain level and within the same industry merge to increase the production of goods and services. The overall gain from a horizontal integration is an increase in the market power and minimal loss for being non-integrated. Horizontal integration…
What is a Short Run? A short run is a term widely used in economics – or microeconomics, more specifically – to describe a conceptualized period of time. A short run doesn’t so much describe literal time, as it describes a planning period in which one or more production inputs are considered fixed in quantity…
What is the Point of Diminishing Returns? The point of diminishing returns refers to a point after the optimal level of capacity is reached, where every added unit of production results in a smaller increase in output. It is a concept used in the field of microeconomics. According to the law of diminishing marginal returns,…
What is National Debt? National debt refers to the total of all debts owed by the government of a country. It mostly comes from bonds and other debt securities, but can also be from direct borrowing from international institutions such as the World Bank. Classifications of National Debt National debt can be classified in various…
What is “Keep and Pay”? “Keep and Pay” refers to a type of bankruptcy strategy that a person can still keep certain assets after filing for bankruptcy, as long as he/she continues to pay for the assets. The rules of keep and pay vary in different states. Understanding Keep and Pay An individual can file…
What is Kamikaze Defense? Kamikaze defense refers to a type of strategy that a target company can take to defend against a hostile takeover. “Kamikaze” means “divine wind” in Japanese. It was originally a special attack unit of the Japanese army, particularly responsible for performing suicide attacks. In the business world, it represents an anti-takeover…
What is the Kagi Chart? The Kagi chart is a type of chart that shows the price movements of an asset. Different from a candlestick chart or other conventional types of charts, a Kagi chart does not contain a time axis, which allows it to show price changes more clearly and effectively. Kagi charts are…
What is a Horizontal Well? A horizontal well is a type of multi-directional drilling technique that drills with an inclination of at least 80 degrees to enhance reservoir performance. The horizontal technique is used as an alternative method for drilling oil and gas in situations where vertical wells are impossible or the shape of the…
What is a Knock-Out Option? A knock-out option is an options contract that will become worthless if the investment reaches a specific price. In such a case, the options contract is “knocked out,” and the investor will not receive a payoff. An options contract refers to an agreement between a buyer and a seller to…
