Month: December 2020

Research and development (R&D) expenses are associated with the research and development of a company’s goods or services. A company generally incurs R&D expenses in the process of finding and creating new products or services. As a type of operating expense, a company may deduct R&D expenses on its tax return.

The Wall Street Journal Prime Rate is an aggregate average of the various prime rates that 10 of the largest banks in the United States charge to their highest credit quality customers for loans with relatively short-term maturities. This combined rate is obtained by way of a market survey and published regularly by The Wall Street Journal (WSJ).

Research and development (R&D) expenses are associated with the research and development of a company’s goods or services. A company generally incurs R&D expenses in the process of finding and creating new products or services. As a type of operating expense, a company may deduct R&D expenses on its tax return.

A learning curve is a concept that graphically depicts the relationship between the cost and output over a defined period of time, normally to represent the repetitive task of an employee or worker. The learning curve was first described by psychologist Hermann Ebbinghaus in 1885 and is used as a way to measure production efficiency and to forecast costs.

Secular is a descriptive word used to refer to market activities that occur over the long term. Secular can also point to specific stocks or stock sectors, unaffected by short-term trends. Secular trends are not seasonal or cyclical. Instead, they remain consistent over time. Secular stocks maintain a static trajectory regardless of current economic trends. When applying the term to the stock market, a secular market is the market’s overarching trend or direction for five years or more. Further, secular trends may be upward or downward in direction. read more

Also known as the Monte Carlo Fallacy, the Gambler’s Fallacy occurs when an individual erroneously believes that a certain random event is less likely or more likely, given a previous event or a series of events. This line of thinking is incorrect, since past events do not change the probability that certain events will occur in the future.

Tactical asset allocation is an active management portfolio strategy that shifts the percentage of assets held in various categories to take advantage of market pricing anomalies or strong market sectors. This strategy allows portfolio managers to create extra value by taking advantage of certain situations in the marketplace. It is as a moderately active strategy since managers return to the portfolio’s original strategic asset mix once reaching the desired short-term profits.

Incidental expenses, also known as incidentals, are gratuities and other minor fees or costs incurred in addition to the main service, item or event paid for during business activities.

Outsourcing is the business practice of hiring a party outside a company to perform services and create goods that traditionally were performed in-house by the company’s own employees and staff. Outsourcing is a practice usually undertaken by companies as a cost-cutting measure. As such, it can affect a wide range of jobs, ranging from customer support to manufacturing to the back office.

Taxes are involuntary fees levied on individuals or corporations and enforced by a government entity—whether local, regional or national—in order to finance government activities. In economics, taxes fall on whomever pays the burden of the tax, whether this is the entity being taxed, such as a business, or the end consumers of the business’s goods.