Cost Decrease
Definition
A cost decrease refers to the reduction in the price or expense associated with producing or purchasing goods and services.
Analogy
Imagine going shopping during a sale. The prices of items have been reduced - this is similar to cost decrease where costs involved in production or purchase go down.
Related terms
Economies of Scale: Reductions in cost per unit resulting from increased production, realized through operational efficiencies.
Deflation: A decrease in the general price level of goods and services often caused by a reduction in the supply of money or credit.
Cost Efficiency: The relationship between output (goods produced) and input (resources used), where costs are minimized.
"Cost Decrease" appears in:
Study guides (1)
Are you a college student?
Study guides for the entire semester
200k practice questions
Glossary of 50k key terms - memorize important vocab
Resources
© 2024 Fiveable Inc. All rights reserved.
AP® and SAT® are trademarks registered by the College Board, which is not affiliated with, and does not endorse this website.