STOCK RESERVE Definition

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STOCK RESERVE (SR) or buffer stock is a stock quantity which is based on the normal average expected consumption during the lead-time to replenish depleted stock. See also SAFETY STOCK.

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WEIGHTED AVERAGE COST OF CAPITAL (WACC) is an average representing the expected return on all of a companys securities. Each source of capital, such as stocks, bonds, and other debt, is weighted in the calculation according to its prominence in the companys capital structure.

FIXED COST is a cost that does not vary depending on production or sales levels, such as rent, property tax, insurance, or interest expense.

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