Showing posts with label frictional costs. Show all posts
Showing posts with label frictional costs. Show all posts

Wednesday 12 April 2017

A basic understanding of the principles of costing is important in business management.

Most non-financial managers instinctively know that costing is important.

Unfortunately, it is probably also true that most non-financial managers do not know very much about it.

This is a pity because it affects so many business decisions.

For example, the fixed costs of running a cruise ship do not vary (or realistically only vary slightly) according to the number of passengers is the reason that large last-minute price reductions are often available. (Think of that when you book your holiday.)

A basic understanding of the principles of costing is important in business management.