Price Elasticity of Demand
Cost
The monetary measure of the amount of resources given up or used for some purpose
Period Costs
The non-manufacturing costs that include selling, administrative, and research and development costs
Price elasticity of demand
What is the ratio of the percentage change in quantity demanded of a product to the percentage change in price
Elasticity
What is the term used to describe this sensitivity?
Manufacturing costs
All costs incurred in the factory to convert raw materials into finished goods
Non-Manufacturing Cost
All costs not incurred in transforming materials to finished goods
Product Costs
Cost incurred to manufacture the product (Direct Materials, Direct Labor, Factory Overhead)
Elasticity of demand
What is the effect of a change in price on the quantity demanded called?
Mixed Cost
This cost has both a variable and a fixed component
Marketing costs
What are Advertising and promotion expenses
General and Administrative Costs
What are all the non-manufacturing costs that yk
After-sales costs
What are costs incurred in dealing with customers after sales?
Research and Development, Marketing Costs, Distribution Costs, Selling costs, After-sale costs, General and Administrative Costs
What are examples of Non-Manufacturing Costs?
Selling Costs
What are salaries and commission of sales staff and other selling exxpenses
Distribution Costs
What are the costs incurred in delivering the product to the customers
Research and Development
What is incurred in designing and bringing new products to the market
Fixed Cost
Within the relevant range an time period under consideration, the total amount remains unchanged, and the per-unit amount varies inversely or indirectly with the change in the cost driver
Variable Cost
Within the relevant range and time period under consideration, the total amount varies directly to the change in activity. The amount per unit is constant