|pecking order theory|
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Definition of pecking order theory
pecking order theory
Firms prefer to issue debt rather than equity if internal finance is insufficient.
The analysis of principal-agent relationships, wherein one person, an agent, acts on behalf of
An alternative model to the capital asset pricing model developed by
Security prices sometimes move wildly above their true values.
A conditional trading order that indicates a security may be purchased only at the designated
Refers to the volatility of returns on international investments caused by events associated
An order to buy or sell stock that automatically expires if it can't be executed on the day it is entered.
A picking method requiring the sequential completion of
order size that minimizes total inventory costs.
The order quantity that minimizes total inventory costs.
an estimate of the number
a business mandate that changes the way in which a product is manufactured or a
theory that expected spot exchange rate equals the forward rate.
A trading order that is canceled unless executed within a designated time period.
a source document that provides virtually
a system of product costing used
An order to buy a stock at or below a specified price or to sell a stock at or above a specified
Limit order book
A record of unexecuted limit orders that is maintained by the specialist. These orders are
Liquidity theory of the term structure
A biased expectations theory that asserts that the implied forward
Local expectations theory
A form of the pure expectations theory which suggests that the returns on bonds
A production scheduling system under which products are only
This is an order to immediately buy or sell a security at the current trading price.
Market segmentation theory or preferred habitat theory
A biased expectations theory that asserts that the
Modern portfolio theory
Principles underlying the analysis and evaluation of rational portfolio choices
A guaranteed form of payment in amounts up to and including $5,000. You might request a money order in order to pay for tuition fees at a university or a college, or for a magazine subscription.
Negotiable order of withdrawal (NOW)
Demand deposits that pay interest.
Normal backwardation theory
Holds that the futures price will be bid down to a level below the expected
Open (good-til-cancelled) order
An individual investor can place an order to buy or sell a security. That
open purchase ordering
a process by which a single purchase
Order penetration point
The point in the production process when a product is
The process of moving items from stock for shipment to customers.
the level of inventory that triggers the placement
the variable cost associated with preparing,
Pecking-order view (of capital structure)
The argument that external financing transaction costs, especially
Preferred habitat theory
A biased expectations theory that believes the term structure reflects the
Pure expectations theory
A theory that asserts that the forward rates exclusively represent the expected
Quantity Theory of Money
theory that velocity is constant, and so a change in money supply will change nominal income by the same percentage. Formalized by the equation Mv = PQ.
random walk theory
Security prices change randomly, with no predictable trends or patterns.
Real Business Cycle Theory
Belief that business cycles arise from real shocks to the economy, such as technology advances and natural resource discoveries, and have little to do with monetary policy.
Sell limit order
Conditional trading order that indicates that a, security may be sold at the designated price or
special order decision
a situation in which management must determine a sales price to charge for manufacturing or service jobs outside the company’s normal production/service market
Static theory of capital structure
theory that the firm's capital structure is determined by a trade-off of the
A stop order that designates a price limit. In contrast to the stop order, which becomes a
An order to sell a stock when the price falls to a specified level.
Stop order (or stop)
An order to buy or sell at the market when a definite price is reached, either above (on a
theory of constraints (TOC)
a method of analyzing the bottlenecks
Debt levels are chosen to balance interest tax shields against the costs of financial distress.
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