transaction cost


Definitions (2)

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.

Use transaction cost in a sentence

  • You need to understand how much the transaction cost will be and be sure to factor that into your budget.

    Was this Helpful?   (25)   (0)
  • The transaction cost was something that I didn't like because it meant that I lost some money and therefore had less.

    Was this Helpful?   (25)   (0)
  • The transaction cost was too high if we went through our primary bank so we proceeded with our secondary bank.

    Was this Helpful?   (25)   (0)
Show more usage examples...

Related Videos

Have a question about transaction cost? Ask for help in the
Browse by Letter: # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z