Archives: Terms

Definition of Price Elasticity of Demand Price Elasticity of Demand (PED) is a measure used in economics to show the responsiveness, or elasticity, of the quantity demanded of a good or service to a change in its price, ceteris paribus. It is calculated by dividing the percentage change in quantity […]

Definition of Point Elasticity Point Elasticity measures the elasticity (responsiveness) of demand or supply at a particular point on the demand or supply curve, as opposed to over a range of prices or quantities. It’s a concept used to determine how a small change in price will affect the quantity […]

Definition of Plough-Back Plough-back, also known as retained earnings, refers to the portion of a company’s net income that is reinvested in the business rather than being distributed to shareholders as dividends. This reinvestment is aimed at promoting business growth, improving infrastructure, funding new projects, or paying off liabilities. Example […]

Definition of Product Life Cycle (PLC) The Product Life Cycle (PLC) is a business concept that describes the stages a product goes through from its initial introduction to the market until it is eventually removed from the market. It covers the period from the product’s first launch to its final […]

Definition of Marginal Utility Marginal Utility is defined as the additional satisfaction or utility that a consumer derives from consuming an additional unit of a good or service. It’s a key concept in microeconomics and is instrumental in understanding consumer choice and demand. The principle of marginal utility states that […]

Definition of Planning Permission Planning permission, also known as development approval, is the formal approval needed to carry out certain types of building work. This regulatory process ensures that any construction, extension, or significant external alteration complies with local planning policies and development plans. Planning permission is required to manage […]

Definition of Land-Use Planning Land-use planning is the process through which government bodies, municipalities, and urban developers manage and regulate the use of land to ensure that it meets social, economic, and environmental objectives. This includes activities like zoning, land development, and the use of geographical information systems (GIS) to […]

Definition of Planned Savings Planned savings refer to the portion of an individual’s or household’s income that is intentionally set aside for future use, rather than being spent immediately on consumption. This type of savings represents a deliberate effort to build financial assets for anticipated expenses, such as education, retirement, […]

Definition of Planned Investment Planned investment refers to the amount of investment that businesses intend to undertake during a given period. It includes expenditures on capital goods like machinery, buildings, technology, and equipment. Planned investment is a critical component of aggregate demand within an economy and is influenced by factors […]

Definition of Planned Economy A planned economy, also known as a command economy, is an economic system where the government or central authority makes all decisions regarding the production, distribution, and consumption of goods and services. This type of system stands in contrast to a market economy, where such decisions […]