Transaction cost

Transaction cost,

Definition of Transaction cost:

  1. A fee charged by a financial intermediary such as a bank, broker, or underwriter.

  2. Economics: The cost associated with exchange of goods or services and incurred in overcoming market imperfections. Transaction costs cover a wide range: communication charges, legal fees, informational cost of finding the price, quality, and durability, etc., and may also include transportation costs. Transaction costs are a critical factor in deciding whether to make a product or buy it. Also called frictional cost. See also transfer cost.

How to use Transaction cost in a sentence?

  1. The transaction cost was too high if we went through our primary bank so we proceeded with our secondary bank.
  2. The transaction cost was something that I didnt like because it meant that I lost some money and therefore had less.
  3. You need to understand how much the transaction cost will be and be sure to factor that into your budget.

Meaning of Transaction cost & Transaction cost Definition