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Financial Terms | |
Inductive reasoning |
Information about financial, finance, business, accounting, payroll, inventory, investment, money, inventory control, stock trading, financial advisor, tax advisor, credit.
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Definition of Inductive reasoningInductive reasoningThe attempt to use information about a specific situation to draw a conclusion.
Related Terms:Deductive reasoningThe use of general fact to provide accurate information about a specific situation. Acceleration ClauseClause causing repayment of a debt, if specified events occur or are not met. ADF (annuity discount factor)the present value of a finite stream of cash flows for every beginning $1 of cash flow. Adjusted Cash Flow Provided by Continuing OperationsCash flow provided by operating Amortization factorThe pool factor implied by the scheduled amortization assuming no prepayemts. Annuity factorPresent value of $1 paid for each of t periods. annuity factorPresent value of an annuity of $1 per period. ![]() Asset-specific RiskThe amount of total risk that can be eliminated by diversification by Asymmetric informationinformation that is known to some people but not to other people. Automated Clearing House (ACH)A collection of 32 regional electronic interbank networks used to Automated Clearing House (ACH)A banking clearinghouse that processes direct benefits-provided rankinga listing of service departments in an order that begins with the one providing the most service Block houseBrokerage firms that help to find potential buyers or sellers of large block trades. Cash Flow Provided by Operating ActivitiesWith some exceptions, the cash effects of transactions Cash Flow Provided or Used from Financing ActivitiesCash receipts and payments involving Cash Flow Provided or Used from Investing ActivitiesCash receipts and payments involving ![]() Clearing House Automated Payments System (CHAPS)A computerized clearing system for sterling funds Clearing house / ClearinghouseAn adjunct to a futures exchange through which transactions executed its floor are settled by a Clearing House Interbank Payments System (CHIPS)An international wire transfer system for high-value Commission houseA firm which buys and sells future contracts for customer accounts. Related: futures Company-specific riskRelated: Unsystematic risk Companyspecific RiskSee asset-specific risk computer-aided manufacturing (CAM)the use of computers to control production processes through numerically computer integrated manufacturing (CIM)the integration of two or more flexible manufacturing systems through the use of a host computer and an information networking system contract manufactureran external party that has been granted an outsourcing contract to produce a part or component for an entity Conversion factorsRules set by the Chicago Board of Trade for determining the invoice price of each cost of goods manufactured (CGM)the total cost of the Cost of manufactureThe cost of goods manufactured for subsequent sale. Country risk GeneralLevel of political and economic uncertainty in a country affecting the value of loans or critical success factors (CSF)any item (such as quality, customer De factoExisting in actual fact although not by official recognition. design for manufacturability (DFM)a process that is part of the project management of a new product; concerned with finding optimal solutions to minimizing product failures Discount factorPresent value of $1 received at a stated future date. discount factorPresent value of a $1 future payment. Expected value of perfect informationThe expected value if the future uncertain outcomes could be known FactorA financial institution that buys a firm's accounts receivables and collects the debt. FactorAn agent who buys and sells goods on behalf of others for a commission. Factor analysisA statistical procedure that seeks to explain a certain phenomenon, such as the return on a Factor modelA way of decomposing the factors that influence a security's rate of return into common and Factor of ProductionA resource used to produce a good or service. The main macroeconomic factors of production are capital and labor. Factor portfolioA well-diversified portfolio constructed to have a beta of 1.0 on one factor and a beta of FactoringSale of a firm's accounts receivable to a financial institution known as a factor. FactoringThe sale of accounts receivable to a third party, with the third party bearing FactoringThe discounting, or sale at a discount, of receivables on a nonrecourse, notification FactoringType of financial service whereby a firm sells or transfers title to its accounts receivable to a factoring company, which then acts as principal, not as agent. Factory overheadAll the costs incurred during the manufacturing process, minus the Field warehouseWarehouse rented by a warehouse company on another firm's premises. Field warehouseA warehouse into which service parts and finished goods are Firm-specific riskSee:diversifiable risk or unsystematic risk. flexible manufacturing system (FMS)a production system in which a single factory manufactures numerous variations Future-Oriented Financial Informationinformation about prospective results of operations, financial position and/or changes in financial position, based on assumptions about future economic conditions and courses of action. Future-oriented financial information is presented as either a forecast or a projection. General Agreementon Tariffs and Trade (GATT) a treaty GENERAL-AND-ADMINISTRATIVE EXPENSESWhat was spent to run the non-sales and non-manufacturing part of a company, such as office salaries and interest paid on loans. General cash offerA public offering made to investors at large. general cash offerSale of securities open to all investors by an already-public company. General ledgerA book that contains all the accounts of the company and the balances of those accounts. General ledgerThe master set of accounts that summarizes all transactions occurring General obligation bondsMunicipal securities secured by the issuer's pledge of its full faith, credit, and General partnerA partner who has unlimited liability for the obligations of the partnership. General partnershipA partnership in which all partners are general partners. Generally Accepted Accounting Principals (GAAP)A technical accounting term that encompasses the Generally accepted accounting principlesThe rules that accountants follow when processing accounting transactions and creating financial reports. The rules are primarily generally accepted accounting principles (GAAP)This important term generally accepted accounting principles (GAAP)Procedures for preparing financial statements. Generally Accepted Accounting Principles (GAAP)A common set of standards and procedures Generally Accepted Accounting Principles (GAAP)GAAP is the term used to describe the underlying rules basis on which financial statements are normally prepared. This is codified in the Handbook of The Canadian Institute of Chartered Accountants. In-house processing floatRefers to the time it takes the receiver of a check to process the payment and Incontestable ClauseThis clause in regular life insurance policy provides for voiding the contract of insurance for up to two years from the date of issue of the coverage if the life insured has failed to disclose important information or if there has been a misrepresentation of a material fact which would have prevented the coverage from being issued in the first place. After the end of two years from issue, a misrepresentation of smoking habits or age can still void or change the policy. Inflation-escalator clauseA clause in a contract providing for increases or decreases in inflation based on informationbits of knowledge or fact that have been carefully Information asymmetryA situation involving information that is known to some, but not all, participants. Information Coefficient (IC)The correlation between predicted and actual stock returns, sometimes used to Information-content effectThe rise in the stock price following the dividend signal. information content of dividendsDividend increases send good news about cash flow and earnings. Dividend cuts send bad news. Information costsTransaction costs that include the assessment of the investment merits of a financial asset. Information-motivated tradesTrades in which an investor believes he or she possesses pertinent Information servicesOrganizations that furnish investment and other types of information, such as Informational efficiencyThe speed and accuracy with which prices reflect new information. Informationless tradesTrades that are the result of either a reallocation of wealth or an implementation of an Insider informationRelevant information about a company that has not yet been made public. It is illegal for Interest FactorNumbers found in compound interest and annuity tables. Usually called the FVIF or PVIF. Just-in-time manufacturingThe term for several manufacturing innovations that just-in-time manufacturing systema production system that attempts to acquire components and produce inventory only as needed, to minimize product defects, and to Limited-tax general obligation bondA general obligation bond that is limited as to revenue sources. Limiting factorThe production resource that, as a result of scarce resources, limits the production of goods management information system (MIS)a structure of interrelated elements that collects, organizes, and communicates Manufactured housing securities (MHSs)Loans on manufactured homes - that is, factory-built or manufacturera company engaged in a high degree of conversion manufacturing cella linear or U-shaped production grouping of workers or machines manufacturing cycle efficiency (MCE)a ratio resulting from dividing the actual production time by total lead time; Manufacturing resource planningAn integrated, computerized system for planning manufacturing resource planning (MRP II)a fully integrated materials requirement planning system that involves Manufacturing resource planning (MRP II)An expansion of the material requirements planning concept, with additional computer-based capabilities in the areas of Maturity factoringfactoring arrangement that provides collection and insurance of accounts receivable. Medical Information BureauThis organization was established in 1902. The Medical information Bureau (M.I.B.) is a non-profit association of life insurance companies. Its purpose is to detect and deter fraud by providing warnings called, alerts, to member companies. For example, if an insurance applicant advised one insurance company of a heart attack and then applied to another insurance company omitting this history, codes, reported by the first insurance company, indicating a heart attack would alert the second insurance company to the undisclosed history. It is a rarity, however, that the alert is the only notice of a specific medical impairement as most applicants completely disclose their history. Multicurrency clauseSuch a clause on a Euro loan permits the borrower to switch from one currency to Multifactor CAPMA version of the capital asset pricing model derived by Merton that includes extramarket Negative pledge clauseA bond covenant that requires the borrower to grant lenders a lien equivalent to any Negotiable order of withdrawal (NOW)Demand deposits that pay interest. Net benefit to leverage factorA linear approximation of a factor, T*, that enables one to operationalize the Old-line factoringfactoring arrangement that provides collection, insurance, and finance for accounts receivable. Related to : financial, finance, business, accounting, payroll, inventory, investment, money, inventory control, stock trading, financial advisor, tax advisor, credit. |