What Is Supply Chain Finance? Supply chain finance (SCF) is a term describing a set of technology-based solutions that aim to lower financing costs and improve business efficiency for buyers and sellers linked in a sales transaction. SCF methodologies work by automating transactions and tracking invoice approval and settlement processes, from initiation to completion. Under
What Is a Supply Curve? The supply curve is a graphic representation of the correlation between the cost of a good or service and the quantity supplied for a given period. In a typical illustration, the price will appear on the left vertical axis, while the quantity supplied will appear on the horizontal axis. Key
What Is Supply Shock? A supply shock is an unexpected event that suddenly changes the supply of a product or commodity, resulting in an unforeseen change in price. Supply shocks can be negative, resulting in a decreased supply, or positive, yielding an increased supply. Assuming aggregate demand is unchanged, a negative (or adverse) supply shock causes
The supply-side theory, or supply-side economics, is a macroeconomic concept that contends that increases in the supply of goods lead to economic growth. Supply-side economists argue that the government should increase production through tax cuts and reduced regulation. A fiscal policy, the supply-side theory has been applied by several U.S. presidents in attempts to stimulate the
What Is the Support Test? The support test is one of five tests that must be passed in order to claim someone else as a dependent for legal and tax purposes. The support test mandates that the taxpayer must have provided more than half of the prospective dependent’s living expenses during the year. Living expenses
What Does Supranational Mean? A supranational organization is a multinational union or association in which member countries cede authority and sovereignty on at least some internal matters to the group, whose decisions are binding on its members. In short, member states share in decision making on matters that will affect each country’s citizens. The EU
What Is a Surplus? A surplus describes the amount of an asset or resource that exceeds the portion that’s actively utilized. A surplus can refer to a host of different items, including income, profits, capital, and goods. In the context of inventories, a surplus describes products that remain sitting on store shelves, unpurchased. In budgetary
What Is a Surplus Spending Unit? A surplus spending unit is an economic unit with income that is greater than or equal to expenditures on consumption throughout a period. A surplus spending unit earns more than it spends on its basic needs and therefore has money left over to invest into the economy through the
What Is Surplus Lines Insurance? Surplus lines insurance protects against a financial risk that is too great or too uncommon for a regular insurance company to take on. Surplus lines insurance can be purchased by individuals or companies. Key Takeaways Surplus lines insurance protects against a financial risk that a regular insurance company will not take
What Is a Surplus Share Treaty? A surplus share treaty is a reinsurance treaty in which the ceding insurer retains a fixed amount of policy liability and the reinsurer takes responsibility for what remains. Surplus share treaties are considered pro-rata treaties and are most commonly used with property insurance. Key Takeaways A surplus share treaty is a
