Tag - cost

[Mock] Essay Paper for UPSC Mains-2016: Role of Educator, Taste for Literature, Cost of Liberty, Success in Dictionary

Instructions Section-A Section-B Essay-hints / Points to Consider #1: Literature and humane society #5: Modern Educator’s role Instructions Write two eassys, choosing one from each of the following sections A and B in about 1000-1200 words each (2 x 125 = 250 marks) Word [...]

Discuss social and environmental cost considerations in establishing steel manufacturing plant.

Ans. There are several types of costs that a firm may consider relevant under various circumstances. Such costs include future costs, accounting costs, opportunity costs, implicit costs, fixed costs, variable costs, semi variable costs, private costs, common cost, social costs and environmental cost etc., [...]

Explain fully the theory of cost as applied to a manufacturing firm. Or How the theory of cost is established ? Or Write short note on theory of the cost. Or Explain the theory of cost.

Ans. Determinants of a Cost Function - There are many factors which affect the cost. Cost function expresses the relationship between cost and its determinants, such as the size of plant, level of output, input prices, technology etc. It can be expressed in the [...]

What are different types of cost ? How would you calculate the cost of a finished product?

Ans. Fixed or constant costs are the part of the total cost of the firm which does not vary with output, for example, rent of land and buildings, expenditures or depreciation, property taxes etc. When the period under consideration is sufficiently long to permit [...]

Describe the following costs- (i) Economic cost (ii) Direct or traceable or assignable costs (iii) Indirect or non-traceable or non-assignable costs.

Ans. (i) Economic Cost - Economic cost of production includes the explicit costs and implicit costs, both. Implicit costs arise when certain inputs (including factors) are owned by the employer himself and employed in the production process. Such a cost is taken into consideration [...]

Define the following costs – (i) Accounting or actual cost (ii) Implicit or imputed costs. (iii) Explicit or paid-out costs

Ans. (i) Accounting or Actual Cost- Actual costs are the costs that the firm incurs while producing or acquiring a good or a service like the cost on raw material, labour, rent, interest etc. The books of account generally record this information. The actual [...]

How would you calculate the cost of a finished product? Define and explain factory cost, manufacturing cost and selling cost. Or How would you calculate the cost of a finished product ? Define and explain prime cost, factory cost and selling cost with an example.

Ans. Cost of Finis need Product- If office and administration overheads are added to factory cost, office cost is arrived at. This is also termed as administration cost, office cost, cost of production or cost of finished product. Factory Cost or Manufacturing Cost- If [...]

Write short note on average cost and marginal cost.

Ans. Average cost is the cost per unit of product, assuming that the production of each unit incurs the same cost. It is obtained by dividing the total cost of production by the total number of products produced. Marginal cost is the additional cost [...]

Write short notes on short run cost and long run cost.

Ans. Short-run Costs - Short-run costs are costs that vary with output when fixed plant and capital equipment remain the same. Short-run costs become relevant when a firm has to decide whether or not to produce more in the immediate future. In this case, [...]

Write short notes on replacement cost and historical cost.

Ans. Replacement Cost - Replacement cost is the cost that would have to be paid currently for purchasing the new plant to replace the old one. As an example, let us say that a plant had cost the firm Rs. 5 lakhs ten years [...]

Write short notes on incremental cost and sunk cost.

Ans. Incremental Cost - Incremental costs are the additions to costs resulting from a change in the nature and level of business activity e.g., change in product line or output level, adding or replacing a machine, changing distribution channels etc. Incremental costs are also [...]