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The justified P/S ratio is calculated as the price-to-sales ratio based on the Gordon Growth Model. Thus, it is the price-to-sales ratio based on the company's fundamentals rather than . Here, g is the sustainable growth rate as defined below and r is the required rate of return. [1]
Retail inventory method. Resellers of goods may use this method to simplify record keeping. The calculated cost of goods on hand at the end of a period is the ratio of cost of goods acquired to the retail value of the goods times the retail value of goods on hand. Cost of goods acquired includes beginning inventory as previously valued plus ...
Cost price is also known as CP. cost price is the original price of an item. The cost is the total outlay required to produce a product or carry out a service. Cost price is used in establishing profitability in the following ways: Selling price (excluding tax) less cost results in the profit in money terms.
According to the law of demand, the demand curve is always downward-sloping, meaning that as the price decreases, consumers will buy more of the good. Mathematically, a demand curve is represented by a demand function, giving the quantity demanded as a function of its price and as many other variables as desired to better explain quantity demanded.
Cost of sales, also denominated "cost of goods sold" (COGS), includes variable costs and fixed costs directly related to the sale, e.g., material costs, labor, supplier profit, shipping-in costs (cost of transporting the product to the point of sale, as opposed to shipping-out costs which are not included in COGS), etc.
In addition to the absolute pass-through that uses incremental values (i.e., $2 cost shock causing $1 increase in price yields a 50% pass-through rate), some researchers use pass-through elasticity, where the ratio is calculated based on percentage change of price and cost (for example, with elasticity of 0.5, a 2% increase in cost yields a 1% increase in price).
In economics, average cost (AC) or unit cost is equal to total cost (TC) divided by the number of units of a good produced (the output Q): A C = T C Q . {\displaystyle AC={\frac {TC}{Q}}.} Average cost is an important factor in determining how businesses will choose to price their products.
The sum of the gross value added in the various economic activities is known as "GDP at factor cost". GDP at factor cost plus indirect taxes less subsidies on products = "GDP at producer price". For measuring the output of domestic product, economic activities (i.e. industries) are classified into various sectors.