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A current asset that represents the amounts due to the company resulting from the sale of goods and services on credit to customers.
see administrative receiver; official receiver.
Companies that have fallen on hard times but could bounce back.
Laying off a primary risk to a secondary insurer.
Risk a purchaser of a bond needs to take into consideration when calculating the yield to maturity on the bond. The calculation assumes that coupn repayments are reinvested at the same rate as the yield to maturity calculated at the time of purchase. The risk is that over the life of the bond interest rates fall and the coupon payments are reinvested at less than the yield to maturity at the time of purchase. Reinvestment risk is one of several types of risk associated with bonds. Others are interest rate risk, credit risk, call risk, inflation risk, currency risk, and event risk.
Categories of liquid assets of a bank or company consisting mainly of retained profits.
Internationally acceptable currency which is held by other countries as part of their central reserves.
Proportion of deposits that a bank must by law keep in cash or place with the central bank.
Banking services primarily for individuals and small businesses; wholesale banking deals with institutions and commercial concerns.
retail price index (RPI)
Measure of the level of shop prices for goods. The inflation rate is the RPI's percentage increase usually compared with the same month the previous year. In the US theconsumer price index does a similar job.
return on assets
Profitability ratio which measures the return a company has generated through the use of its total assets.
return on equity
Measurement of profitability. It is calculated as net income less preferred dividend requirement divided by last year's common equity times 100.
Line of credit for a fixed sum, allowing repeated use of the credit providing that the fixed sum is not exceeded; regular scheduled repayments of predetermined amounts are made.
Offer of shares to existing shareholders usually at a discount to market price.
Discount rates used for risk assets, such as equities, are higher than those used for risk-free assets, such as gilts. Equity risk premium is the difference.
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