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Understanding Market Cycles Key takeaways * Market cycles are recurring patterns of expansion and contraction that affect asset prices across sectors and industries. * Four core phases: accumulation, mark-up (uptrend), distribution, and downtrend (markdown). * Cycles vary widely in length depending on market and timeframe — from minutes to decades. * Identifying a cycle phase…

Market Capitalization-to-GDP Ratio (Buffett Indicator) The market capitalization-to-GDP ratio compares the total market value of a country’s publicly traded companies to its gross domestic product (GDP). Often called the Buffett Indicator, it provides a broad, aggregate gauge of whether equity markets are expensive or cheap relative to the size of the economy. What it measures…

Market Capitalization: What It Means for Investors What is market capitalization? Market capitalization (market cap) is the total market value of a publicly traded company’s outstanding shares. It represents what the market currently values a company at and is commonly used to indicate company size and to compare companies within or across industries. How to…

Market Cannibalization Market cannibalization happens when a company’s new product or outlet takes sales away from one of its existing products or locations. Rather than expanding total market share, the new offering shifts demand within the firm’s own portfolio. This can be intentional (a defensive or growth strategy) or unintentional (a byproduct of product design,…

Market Breadth: Definition, Indicators, and How Investors Use It Market breadth measures how many stocks participate in a market move—specifically the relationship between advancing and declining securities within an index or exchange. Rather than judging an index solely by its price, breadth shows whether the move is broad-based (many stocks contributing) or narrow (driven by…

Market Basket: Definition, Use in Investing, and Example Key takeaways A market basket is a selected group of goods, services, or financial assets used to track price movements or market performance. The Consumer Price Index (CPI) is the best-known market basket for measuring inflation across a broad set of consumer goods and services. In finance,…

Market Approach: Definition and How It Works to Value an Asset Key takeaways * The market approach values an asset by comparing it to recent sales of similar assets. * It works best when plentiful, recent comparable-transaction data exist (e.g., residential real estate, public securities). * When comparables are scarce or dissimilar (e.g., private-company shares,…

Market: Definition, How It Works, Types, and Regulation What is a market? A market is any venue—physical or virtual—where buyers and sellers meet to exchange goods, services, information, or financial assets. It can be a brick-and-mortar store, an online platform, a stock exchange, or an abstract concept such as the labor or housing market. Markets…

Mark Zuckerberg: Founder and CEO of Meta Key takeaways * Self-taught programmer who launched Facebook from his Harvard dorm in 2004. * Grew the company—now Meta—into a global tech leader through rapid expansion, a record IPO, and major acquisitions. * Known for high-profile philanthropy and for controversies over user data and privacy. * Primary revenue…

Maritime Law: Key Concepts and Importance What is maritime (admiralty) law? Maritime law, also called admiralty law, is the body of rules, conventions, and treaties that govern private maritime business and nautical matters. It covers disputes and offenses that arise on the seas and other navigable waters, including issues involving ships, cargo, crew, and passengers….

Marital Property: Common Law vs. Community Property Definition Marital property generally means assets and debts acquired during a marriage that are subject to division on divorce or distribution at death. Property owned before marriage, inheritances, and many gifts remain separate unless they are commingled with marital assets. How marital property is treated depends on the…

Marginal Utility Understanding marginal utility helps explain consumer choices and market behavior. It is the additional satisfaction (utility) a person gains from consuming one more unit of a good or service. Marginal utility can be positive, zero, or negative, and it underpins many pricing, production, and policy decisions. Key takeaways Marginal utility (MU) is the…

Marginal Tax Rate A marginal tax rate is the percentage of tax applied to each additional dollar of taxable income within a specific tax bracket. It tells you how much tax you will pay on the next dollar you earn, not the share of your total income that goes to taxes. How it works Taxable…

Marginal Social Cost (MSC) What is MSC? Marginal social cost (MSC) is the additional cost borne by society when one more unit of a good or service is produced. It extends beyond the producer’s direct expenses to include impacts on other people, communities, and the environment. Formula: MSC = MPC + MEC * MPC =…

Marginal Revenue Product (MRP) What it is Marginal Revenue Product (MRP) is the additional revenue generated by employing one more unit of a productive resource (for example, a worker, machine, or input). It equals the marginal physical product (MPP) of the resource multiplied by the marginal revenue (MR) from selling the additional output: MRP =…

Marginal Revenue (MR) Definition Marginal revenue (MR) is the additional revenue a firm earns from selling one more unit of a product or service. It measures how total revenue changes when quantity sold increases by a small amount (often one unit). How it works MR depends on the market demand curve. When a firm must…

Marginal Rate of Transformation (MRT) The marginal rate of transformation (MRT) measures the opportunity cost in production: how much of one good (Y) must be given up to produce one additional unit of another good (X). It summarizes production trade‑offs when resources and technology are fixed. Key idea MRT is the absolute value of the…

Marginal Rate of Technical Substitution (MRTS) What MRTS means The marginal rate of technical substitution (MRTS) measures the rate at which a firm can replace one input (typically labor, L) with another (typically capital, K) while keeping output constant. It describes trade-offs between inputs along an isoquant — the curve showing all input combinations that…

Marginal Rate of Substitution (MRS) What is MRS? The marginal rate of substitution (MRS) quantifies how much of one good a consumer is willing to give up to obtain an additional unit of another good while keeping the same level of satisfaction (utility). It captures trade-offs in consumer choice and is central to indifference-curve analysis…

Marginal Propensity to Save (MPS) Overview Marginal propensity to save (MPS) measures the fraction of an incremental increase in income that a consumer saves rather than spends. It is a core concept in Keynesian macroeconomics used to analyze consumption behavior and the broader effects of fiscal policy. Definition and formula MPS = Change in saving…

Marginal Propensity to Import (MPM) The marginal propensity to import (MPM) measures how much imports change in response to a change in disposable income. It captures the portion of each additional dollar of income that is spent on foreign-produced goods and services. Key points Definition: MPM = ΔImports / ΔDisposable Income (often written as dIm/dY)….

Marginal Propensity to Consume (MPC) The marginal propensity to consume (MPC) is the fraction of an additional unit of income that a household spends on consumption rather than saving. It is a fundamental concept in Keynesian economics used to analyze how changes in income affect consumer spending and, by extension, aggregate demand. Definition and formula…

Marginal Profit Marginal profit is the change in profit from producing and selling one additional unit of a good or service. It equals the extra revenue earned from that unit (marginal revenue) minus the extra cost of producing it (marginal cost). Key formula: * Marginal profit = Marginal revenue (MR) − Marginal cost (MC) Explore…

Marginal Cost of Production What it is Marginal cost is the additional cost a firm incurs to produce one more unit of a good or service. It isolates the incremental expenses that change with output (mostly variable costs), and it helps firms decide how much to produce and at what price to sell. Example: If…

Key takeaways * Marginal benefit is the additional satisfaction or the maximum price a consumer is willing to pay for one more unit of a good or service. * Marginal benefit typically falls as consumption increases (law of diminishing marginal benefit). * Consumers buy additional units until marginal benefit equals price; producers expand output until…

Marginal Analysis What it is Marginal analysis is a decision-making tool used to evaluate the incremental benefits and costs of a small change in activity — for example, producing one more unit, hiring one more worker, or consuming one more slice of pizza. It helps identify whether an additional unit of effort or consumption adds…

Margin of Safety: Definition and Examples What it is The margin of safety is a buffer used to reduce downside risk. In investing, it means buying a security only when its market price is sufficiently below its estimated intrinsic value. In accounting, it measures how far current or projected sales can fall before a business…

Margin Loan Availability: What It Means and How It Works Margin loan availability is the amount in a margin account that a brokerage customer can either borrow against to buy more securities or withdraw. A margin account uses the customer’s eligible securities as collateral for loans from the brokerage. How it works The available amount…

Margin Debt What is margin debt? Margin debt is the amount an investor borrows from a broker through a margin account to buy securities. The investor’s own funds in the account are the equity (or margin), while the borrowed portion is the margin debt. Securities purchased on margin serve as collateral for the loan. How…

Margin Call A margin call is a broker’s demand that an investor who has borrowed money to buy securities deposit additional funds or marginable securities when the account’s equity falls below the broker’s required maintenance level. If the investor doesn’t meet the call, the broker can sell holdings—often without prior notice—to cover the deficiency. Key…

Margin Account Definition A margin account is a brokerage account that lets investors borrow money from their broker to buy securities (leverage) or to sell short. Borrowing increases purchasing power but also magnifies gains and losses. Key points Margin enables larger positions than cash-only accounts by borrowing against the account’s holdings. Regulation T typically limits…

Margin and Margin Trading Explained Margin is the equity an investor has in a brokerage account used as collateral when borrowing from a broker. Margin trading means borrowing that money to buy (or short) securities, amplifying both potential gains and losses. Margin can also refer more broadly to profit ratios in business or the interest…

Maquiladora: Definition, How It Works, Benefits, Concerns, and History Key takeaways * A maquiladora is a factory in Mexico owned or operated by a foreign company that assembles or manufactures goods primarily for export. * These plants are commonly located near the U.S.–Mexico border and benefit from lower labor costs, tax incentives, and duty exemptions…

Manufacturing Resource Planning (MRP II) Manufacturing Resource Planning (MRP II) is an integrated, computer-based information system that helps manufacturers determine and allocate the resources needed for efficient production. It centralizes data and coordinates scheduling, inventory, capacity, and cost control to support operational decision-making. Key takeaways MRP II extends materials requirement planning (MRP) by adding capacity…

Understanding Manufacturing: Definitions, Processes, and Economic Role Manufacturing is the transformation of raw materials into finished, tangible goods using tools, machinery, labor, and chemical or physical processes. It ranges from handcrafted items to high-volume, technology-driven production and is a key indicator of economic strength. Key takeaways Manufacturing converts raw materials into valuable finished goods and…