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Definition of Variable
A value determined within the context of a model. Also called endogenous variable.
A random value that can take any fractional value within specified ranges, as
an unknown item for which a linear programming
an unknown variable that is to be predicted
A random variable that can take only a certain specified set of discrete possible
A value determined within the context of a model.
A variable whose value is determined outside the model in which it is used. Also called
a variable that, when changed, will
a critical factor that management believes will
A random variable that has a normal probability distribution.
A function that assigns a real number to each and every possible outcome of a random experiment.
Costs that have both fixed and variable components.
a variable used in a linear programming problem
a variable used in a linear programming problem that represents overachievement of a minimum requirement; it is associated with greater-than-or-equal-to constraints
Annuity contracts in which the issuer pays a periodic amount linked to the investment
A form of annuity policy under which the amount of each benefit is not guaranteed or specified. The amounts fluctuate according to the earnings of a separate investment account.
A cost that is directly proportional to the volume of output produced. When production is zero,
A cost that increases or decreases in proportion with increases or decreases in the volume of production of goods or services.
a cost that varies in total in direct proportion
A cost that changes in amount in relation to changes in a related activity.
variable cost ratio
the proportion of each revenue dollar
A method of costing in which only variable production costs are treated as product costs and in which all fixed (production and non-production) costs are treated as period costs.
a cost accumulation and reporting method
Costs that change as the level of output changes.
Those that vary with the amount of goods you produce or sell. These may include utility bills, labor, etc.
Expenses that change with changes in either sales volume
Variable life insurance policy
A whole life insurance policy that provides a death benefit dependent on the
variable overhead efficiency variance
the difference between budgeted variable overhead based on actual input activity and variable overhead applied to production
variable overhead spending variance
the difference between total actual variable overhead and the budgeted amount of variable overhead based on actual input activity
Variable price security
A security, such as stocks or bonds, that sells at a fluctuating, market-determined price.
Variable rate CDs
Short-term certificate of deposits that pay interest periodically on roll dates. On each roll
Variable rate loan
Loan made at an interest rate that fluctuates based on a base interest rate such as the
Variable rated demand bond (VRDB)
Floating rate bond that can be sold back periodically to the issuer.
A method of costing in which all fixed and variable production costs are charged to products or services using an allocation base.
a cost accumulation and reporting
Alternative mortgage instruments
Variations of mortgage instruments such as adjustable-rate and variablerate
The correlation of a variable with itself over successive time intervals.
Elements of spending that do not vary systematically with variables such as GDP that are explained by the theory. See also exogenous expenditure.
The beginning inventory for a period, plus the amount at the end of
variable that adjusts to maintain the consistency
An analytical technique for studying the relationships between fixed cost, variable cost, and profits. A breakeven chart graphically depicts the nature of breakeven analysis. The breakeven point represents the volume of sales at which total costs equal total revenues (that is, profits equal zero).
a graph that depicts the relationships among revenues, variable costs, fixed costs, and profits (or losses)
the total variable cost of carrying one unit of
coefficient of correlation
a measure of dispersion that indicates the degree of relative association existing between two variables
Coefficient of determination
A measure of the goodness of fit of the relationship between the dependent and
Also the difference between the selling price and variable costs, which can be expressed either per
The difference between variable revenue and variable cost.
An intermediate measure of profit equal to sales revenue
the difference between selling price and
The margin that results when variable production costs are subtracted
contribution margin ratio
the proportion of each revenue dollar remaining after variable costs have been covered;
The simultaneous change in value of two random numeric variables.
an analytical technique that uses statistical
A standardized statistical measure of the dependence of two random variables,
A measure of the tendency of two variables to change values
The idea that fixed costs and variable costs react differently to changes in the volume of
the practice of minimizing, to the extent
the relative composition of an organization’s
A statistical measure of the degree to which random variables move together.
Cumulative probability distribution
A function that shows the probability that the random variable will
A variable like GDP is measured in current dollars if each year's value is measured in prices prevailing during that year. In contrast, when measured in real or constant dollars, each year's value is measured in a base year's prices.
see variable costing
Direct materials mix variance
The variance between the budgeted and actual mixes of
Related: variable life
An adjective indicating that something is determined by forces unrelated to the theory determining the variables under investigation.
The value of the possible outcomes of a variable weighted by the
A guaranteed investment contract where the credit rating is tied to some variable
gross margin, or gross profit
This first-line measure of profit
a technique used to determine the fixed
a number (prefaced as a multiplier
a mathematical programming technique in which all solutions for variables must be restricted to whole numbers
Interest rate swap
A binding agreement between counterparties to exchange periodic interest payments on
Inverse floating rate note
A variable rate security whose coupon rate increases as a benchmark interest rate declines.
Payment of a financial obligation later than is expected or required, as in lead and lag. Also, the number
A variable that reaches a turning point (a peak or a trough) before the economy reaches a turning point.
least squares regression analysis
a statistical technique that investigates the association between dependent and independent variables; it determines the line of "best fit" for a set of observations by minimizing the sum of the squares
The London Interbank Offered Rate; the rate of interest that major international banks in London
a method of mathematical programming used to solve a problem that involves an objective function and multiple limiting factors or constraints long-term variable cost a cost that was traditionally viewed as a fixed cost
Log-linear least-squares method
A statistical technique for fitting a curve to a set of data points. One of the
A distribution where the logarithm of the variable follows a normal distribution.
A period of time in which all costs are variable; greater than one year.
A period of time in which all costs are variable; greater than one year.
The expected value of a random variable.
Errors in measuring an explanatory variable in a regression that leads to biases in
a cost that has both a variable and a fixed component;
Used in charts and technical analysis, the average of security or commodity prices
The estimated relationship between a dependent variable and more than one explanatory variable.
a statistical technique that uses two or
Change in the equilibrium value of a variable of interest per change in a variable over which one has control. "The" multiplier is the change in equilibrium income per change in government spending.
Neutrality of Money
The doctrine that the money supply affects only the price level, with no long-run impact on real variables.
Normal (bell-shaped) distribution
In statistics, a theoretical frequency
Normal probability distribution
A probability distribution for a continuous random variable that is forms a
the proportionate relationship between
Optimum selling price
The price at which profit is maximized, which takes into account the cost behaviour of fixed and variable costs and the relationship between price and demand for a product/service.
the variable cost associated with preparing,
Ordinary least squares (OLS)
regression analysis a statistical technique that minimizes the sum of the squared deviations between a dependent variable and one or more independent variables and provides the user
Overhead generally refers to indirect, in contrast to direct,
overhead efficiency variance
the difference between total budgeted overhead at actual hours and total budgeted
overhead spending variance
the difference between total actual overhead and total budgeted overhead at actual
A representation that characterizes a part of a model (e.g. a growth rate), the value of which is
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