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Within economics, margin is a concept used to describe the current level of consumption or production of a good or service. [1] Margin also encompasses various concepts within economics, denoted as marginal concepts , which are used to explain the specific change in the quantity of goods and services produced and consumed.
The term “marginal cost” may refer to an opportunity cost at the margin, or more narrowly to marginal pecuniary cost — that is to say marginal cost measured by forgone cash flow. Other marginal concepts include (but are not limited to): marginal physical product (sometimes also known as “marginal product”) marginal product of labor
Calculating the contribution margin is an excellent tool for managers to help determine whether to keep or drop certain aspects of the business. For example, a production line with positive contribution margin should be kept even if it causes negative total profit, when the contribution margin offsets part of the fixed cost.
A margin account is a brokerage account in which the broker lends the customer cash to purchase stocks or other financial products.
Margins matter. The more SeaDrill Limited (NYS: SDRL) keeps of each buck it earns in revenue, the more money it has to invest in growth, fund new strategic plans, or (gasp!) distribute to ...
Typically, margin investing works based on margin loans. These are loans that your brokerage extends so that you can purchase with a combination of your own funds and borrower money, giving you ...
This difference has to stay above a minimum margin requirement, the purpose of which is to protect the broker against a fall in the value of the securities to the point that the investor can no longer cover the loan. Margin lending became popular in the late 1800s as a means to finance railroads. [1] In the 1920s, margin requirements were loose.
Of course, if an investment purchased on margin does well, the gains can be richly rewarding. Liquidity Besides using a margin loan to buy more stock than investors have cash for in a brokerage ...