Describe the following within the industry:
Budget - "An estimation of the revenue and expenses over a specified future period of time."
The budget is the amount of money the company is willing to spend on there game. this cost can vary due to many reasons such as they amount of time it takes the project, if it takes more time than needed the budget will over run. This could make the project stop as they might not be able to afford the cost of over running.
Fixed costs - "A cost that does not change with an increase or decrease in the amount of goods or services produced."Fixed cost can be an issues in the industry as the amount usually is overdrawn, this means that the project will stop until more money can be made to get the project running once again. This isn't always a bad thing as it makes you think what you really need to build a game, and not just throw in what you want but what the game could really use to make it better.
Variable costs - "A corporate expense that varies with production output. Variable costs are those costs that vary depending on a company's production volume; they rise as production increases and fall as production decreases." Variable cost do what is said in the name, It rises to work with the company over running the project or it will decrees if the money is too much and not all of it is needed.
Break-even point -
1. "In general, the point at which gains equal losses."
2. "In options, the market price that a stock must reach for option buyers to avoid a loss if they exercise. For a call, it is the strike price plus the premium paid. For a put, it is the strike price minus the premium paid."
When you break even you basically make what you spent, lets say you spent £1000 to create a video game, you would be - £1000 in debt, then when you sell the game you would make exactly £1000 in game sales, so this mean you would break even.
No comments:
Post a Comment