Absolute Auction – Explained

by TheBusinessProfessor | Feb 23, 2025 | Sales

What is an Absolute Auction?An absolute auction is a type of auction sale when the purchase amount is neither set (reserve price) nor negotiated. Instead, the purchase amount comes through competitive, open bidding, with the highest price as the winning bid. The...

Abnormal Return – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is an Abnormal Return?The benefits expected from a specific portfolio or security beyond its expected return over a certain period of time are termed as abnormal returns. The abnormal return is not the expected return since it exceeds of what was expected.How do...

Accounts Receivable – Explained

by TheBusinessProfessor | Feb 23, 2025 | Managerial & Financial Accounting & Reporting

What are Accounts Receivable (AR)?Accounts receivable refers to the balance of money owed to a firm for goods or services that the company allowed its customers to purchase on credit. These are the outstanding invoices that a company possesses. In the balance sheet of...

Accrual Bond – Explained

by TheBusinessProfessor | Feb 23, 2025 | Business Finance, Personal Finance, and Valuation Principles

What is an Accrual Bond? A bond is a debt instrument issued by a debtor to a creditor evidencing the debt. It contains loan details, including the principal loan and the periodic interest payments to be made by the issuer to the bond holder. An accrual bond is a type...

Above Par (Bond Price) – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is Above Par Bond Price?Above par is the term used to describe the price of a bond that is trading at a premium above its face value. It happens when the income distributions of a bond are above those of others available in the market. It is caused by declined...

Abductive Reasoning

by TheBusinessProfessor | Feb 23, 2025 | Management, Leadership, & Organizational Behavior

What is Abductive Reasoning?The abductive reasoning method is the logical process of making observations and seeking the hypothesis that would best fit or explain those observations. Abducitve Reasoning and the Scientific ProcessAbductive reasoning is an integral part...

ABX Index – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is the ABX Index?The ABX index is an economic reference point that gauges the monetary worth of the investment market for subprime mortgages with lowered interest rates. The index comprises 20 residential mortgage-backed securities or RMBS.How does the ABX Index...

Activity Based Costing (Accounting) – Explained

by TheBusinessProfessor | Feb 23, 2025 | Managerial & Financial Accounting & Reporting

What is the Activity Based Costing? The ABC (Activity Based Costing) method of cost accounting pertains to a company’s resource-consuming activities that create costs. It uses physical, monetary and non-monetary indicators to measure these costs and assumes a...

Weak Form Market Efficiency – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is Weak Form Market Efficiency?Weak form market efficiency, also known as he random walk theory is part of the efficient market hypothesis. The efficient market hypothesis concerns the extent to which outside information has an effect upon the market price of a...

Warrant (Finance) – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is a Warrant?A warrant is defined as permit that investors or employees have to buy or sell a number of ownership interest in the company at a strike price at a period in time. Most investors are attracted to warrants, this is because it gives them the right to...