# Definition of __Turning Point__

## Turning Point

The trough or peak of a business cycle.

# Related Terms:

A variable that reaches a **turning point** (a peak or a trough) before the economy reaches a **turning point**.

The upper **turning point** of a business cycle, where expansion turns into a contraction.

The lower **turning point** of a business cycle, where a contraction turns into an expansion.

The graphical depiction of the relationship between the yield on bonds of the same credit quality

but different maturities. Related: Term structure of interest rates. Harvey (1991) finds that the inversions of

the yield curve (short-term rates greater than long term rates) have preceded the last five U.S. recessions. The

yield curve can accurately forecast the **turning point**s of the business cycle.

In the bond market, the smallest measure used for quoting yields is a basis **point**. Each percentage

**point** of yield in bonds equals 100 basis **point**s. Basis **point**s also are used for interest rates. An interest rate of

5% is 50 basis **point**s greater than an interest rate of 4.5%.

One one-hundredth of one percent

One hundredth of one percentage **point**, or 0.0001.

One one-hundredth of a percentage **point**, used to express variations in yields. For example, the difference between 5.36 percent and 5.38 percent is 2 basis **point**s.

A conventional unit of measure for bond prices set at $10 and equivalent to 1% of the $100 face

value of the bond. A price of 80 means that the bond is selling at 80% of its face, or par value.

the level of activity, in units or dollars, at which total revenues equal total costs

The **point** at which total costs equal total revenue, i.e. where there is neither a profit nor a loss.

The annual sales volume level at which total contribution

margin equals total annual fixed expenses. The breakeven **point** is only a

**point** of reference, not the goal of a business, of course. It is computed by

dividing total fixed expenses by unit margin. The breakeven **point** is

quite useful in analyzing profit behavior and operating leverage. Also, it

gives manager a good **point** of reference for setting sales goals and

understanding the consequences of incurring fixed costs for a period.

The sales level at which a company, division, or product line makes a

profit of exactly zero, and is computed by dividing all fixed costs by the average

gross margin percentage.

The **point** below which the firm will need either to obtain additional financing

or to liquidate some of its assets to meet its fixed costs.

Those **point**s designated by futures exchanges at which the financial instrument or

commodity covered by a futures contract may be delivered in fulfillment of such contract.

## Free-on-Board (FOB) Shipping Point

A shipping arrangement agreed to between buyer and

seller where title to the goods sold passes when the goods in question are delivered to a common

carrier. When goods are shipped FOB shipping **point**, revenue is properly recognized when the

goods are delivered to the common carrier.

## Order penetration point

The **point** in the production process when a product is

reserved for a specific customer.

## order point

the level of inventory that triggers the placement

of an order for additional units; it is determined based

on usage, lead time, and safety stock

## Outbound stock point

A designated inventory location on the shop floor between

operations where inventory is stockpiled until needed by the next operation.

## Point

The smallest unit of price change quoted or, one one-hundredth of a percent. Related: minimum price

fluctuation and tick.

## Point and figure chart

A price-only chart that takes into account only whole integer changes in price, i.e., a

2-**point** change. **point** and figure charting disregards the element of time and is solely used to record changes

in price.

## Point and figure chart

A financial chart usually used to plot asset price data.

Upward price movements are plotted as X’s and downward price movements

are plotted as O’s.

## point of sale (POS)

The terminal at which a customer uses his/her debit card to make a direct payment transaction. See also Interac Direct Payment.

## Point-of-use delivery

A delivery of stock to a location in or near the shop floor

adjacent to its area of use.

## Point-of-use storage

The storage of stock in a location in or near the shop floor

adjacent to its area of use.

## Price value of a basis point (PVBP)

Also called the dollar value of a basis **point**, a measure of the change in

the price of the bond if the required yield changes by one basis **point**.

## split-off point

the **point** at which the outputs of a joint process are first identifiable or can be separated as individual products

## Split-off point

The **point** in a production process when clearly identifiable joint costs

can be identified within the process.

## Stockpoint

An inventory storage area used for short-term inventory staging.

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