Definitions and ExplanationsWhat is GST? GST refers to the Goods and Services Tax of Canada. It is a 5% value added tax on most goods and services in Canada. If you’re a business owner in Canada, then you are required by law to charge GST on covered goods and services. If you’re a consumer, then the price [...]
What is Cap Rate? Cap rate or capitalization rate is a ratio referring to the value of a particularly property based on its operating income and capital cost or market value. It is used by appraisers, lenders, and investors to have an estimate value of a property that is said to be income-generating. In simple [...]
What is Monetary Policy? Interest rates regulations and money availability for the prevention of hard market crashes are often referred to as monetary policy. The United States establishes monetary policy through the United States Federal Reserve. Various countries use similar agency or system to monitor their monetary policy. The importance of monetary policy is often [...]
What is Quantitative Easing? Quantitative easing is a term used in finance and economics where a country’s central bank takes action to boost a country’s economy by increasing the supply of money. This is done when bank interests have gone to almost 0% and the desired result still has not been achieved. Quantitative easing was [...]
Everyday there is talk of the economy either improving or declining, big and small economies, emerging economies and so much more. We all have a vague idea of what all this means but to be able to truly understand this economy talk we must begin by understanding what economics is all about. Economics is the [...]
What is McDonaldization? McDonaldization is a sociological term coined by a man named George Ritzer. Through a book that he released back in 1993 entitled “The McDonaldization of Society”, he likens the cultural and social development of man to that of the famous fastfood chain. The main concept of McDonaldization involves some form of rationalization [...]
What is Globalization? Globalization is a term that has several meanings and applications but generally refers to the increased cooperation between different countries in terms of trade and commerce. Most people agree that the term “globalization” started as an economic term which covers the unification of the world’s economies for better trading of goods and [...]
What is GNP and GDP? GNP stands for Gross National Product while GDP stands for Gross Domestic Product. Both terms represent as indicators of the economic stability or soundness of a particular country. The main difference between the two economic indicators is that GDP has a scope limited to “domestic” location, while GNP covers all [...]
What is EOQ Inventory? EOQ stands for “Economic Order Quantity” and it refers the best level of inventory that a company can have in relation to costs and expenses that nthis same company shoulders in terms of production, inventory holding, demand rate, and other production variables. When quantifying EOQ, it basically points to how much [...]
What is DTA? “DTA,” or “domestic tariff areas” are areas or zones that are located outside India’s SEZ and/or EOU. SEZ, or special economic zones, are specific locations wherein businesses typically function with less hassles for foreign investors in terms of taxes, tariffs, and procedural guidelines. EOU’s, or Export Oriented Units, meanwhile, are created similarly [...]
Free enterprise refers to an economic system that allows people to create and conduct business in order to make a profit from it and without too much meddling from the government in terms of business practice rules and regulations. The main feature of a free enterprise economy is that businesses are allowed to compete with [...]
