Expected Return vs Required Return Individuals and organizations make investments with expectations of gaining the highest possible return. An investor who takes risk will expect to receive a rate of return that corresponds to the respective level of risk. Required rate of return and expected return represent the levels of return that is to […]
Difference Between Diminishing Returns and Diseconomies of Scale
Diminishing Returns vs Diseconomies of Scale Diseconomies of scale and diminishing returns are both concepts in economics that are closely related to one another. Both these concepts represent how the company can end up making losses as inputs are increased in the production process. Since these concepts are quite similar to one another, they […]
Difference Between Swap and Forward
Swap vs Forward Derivatives are special financial instruments that derive their value from one or more underlying assets. The changes in movements, in the values of the underlying assets, affect the manner in which the derivative is used. Derivatives are used for hedging and speculation purposes. The following article takes a closer look at […]
Difference Between Derivatives and Equity
Derivatives vs Equity Equity and derivatives are financial instruments that are quite different to each other. The main similarity between the two is that both equity and derivatives can be purchased and sold, and there are active equity and derivative markets for such trade. The article provides a clear overview of each concept and […]
Difference Between Human Capital and Physical Capital
Human Capital vs Physical Capital There are a number of factors of production that are essential for the production process. One such factor of production is capital which may be in the form of cash, buildings, machinery, or even human skills and expertise. Human capital is the skills, knowledge, experience contributed by the firm’s […]
Difference Between Human Resources and Human Capital
Human Resources vs Human Capital Human resources and human capital are concepts that are clearly very similar to each other as they refer to current or potential human skills, capabilities, and talent that are essential to the success of any organization. The two concepts are often misunderstood and are mistakenly assumed to be the […]
Difference Between FDI and FII
FDI vs FII FDI (Foreign Direct Investments) and FII (Foreign Institutional Investments) both relate to foreign investments made by an entity based in another country. FDI and FII are both quite similar in that they both result in a substantial inflow of funds into a foreign country, and generally result in higher development and […]
Difference Between Diminishing Returns and Decreasing Returns to Scale
Diminishing Returns vs Decreasing Returns to Scale Diminishing returns and decreasing returns to scale are terms widely used in the study of economics. They both show how levels of output can fall when inputs are increased beyond a certain point. Despite their similarities, diminishing returns and decreasing returns to scale are different to one […]
Difference Between Elasticity of Demand and Elasticity of Supply
Elasticity of Demand vs Elasticity of Supply Similar in meaning to the expansion of a rubber band, elasticity of demand/supply refers to how changes in X (which can be anything such as price, income, raw material prices, etc.) can affect the quantity demanded or quantity supplied. In price elasticity of demand (PED) and price […]
Difference Between Collateral and Security
Collateral vs Security Collateral refers to any asset that is pledged to the bank by the borrower when taking out a loan; which the bank uses to recover losses in the event that the borrower defaults on his loan. Collateral can refer to any type of asset with value such as land, buildings (houses), […]