Rule of 78 – Explained

by TheBusinessProfessor | Feb 23, 2025 | Banking, Lending, and Credit Industry

Update Table of Contents What is the Rule of 78?How Does the Rule of 78 Work? What is the Rule of 78?The Rule of 78 is a method of calculating yearly interest which is commonly applied to the short-term consumer and business loans. The name Rule of 78 is derived from...

Regulation U – Explained

by TheBusinessProfessor | Feb 23, 2025 | Banking, Lending, and Credit Industry

Update Table of Contents What is Regulation U?How Does Regulation U Work? What is Regulation U?Regulation U was promulgated by the Board of Governors of the Federal Reserve System for preventing the excessive use of credit for the purchase or carrying of securities....

Rule of 72 – Explained

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

What is the Rule of 72?It is a simple calculation method to estimate an investments doubling time with a specific fixed annual interest rate. It is the easiest and fastest way to calculate how long an investment will take to double, given a fixed annual rate of...

Ricardo Barro Effect – Explained

by TheBusinessProfessor | Feb 23, 2025 | Economic Analysis & Monetary Policy

What is the Ricardo-Barro Effect?The Ricardo-Barro Effect, also known as Ricardian equivalence, is a microeconomic concept that suggests when there is a reduction in government spending and an increase in taxation; in response, households and businesses increase their...

Research and Development (R&D) – Explained

by TheBusinessProfessor | Feb 23, 2025 | Operations, Project, & Supply Chain Management

What is Research and Development (R&D)?Research and Development is a process implemented by the companies or governmental organizations to innovate or improve its products and services. The Research and Development activity may involve both the basic research and...

Regulation Z – Explained

by TheBusinessProfessor | Feb 23, 2025 | Banking, Lending, and Credit Industry

Update Table of Contents What is Regulation Z?How Does Regulation Z Work? What is Regulation Z?Regulation Z is a Federal Reserve Regulation and a part of the Truth in Lending Act of 1968. The regulation requires the lenders to disclose all the terms and conditions of...

Regulation T – Explained

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

What is Regulation T?Regulation T is a Federal Reserve Boards regulation that governs the investors use of a cash account for purchasing securities and regulates the credit extension limit by security brokers and dealers. The regulation prescribes that security...

Regulation R – Explained

by TheBusinessProfessor | Feb 23, 2025 | Banking, Lending, and Credit Industry

Update Table of Contents What is Regulation R?How Does Regulation R Work? What is Regulation R?Regulation R implements an exemption for banks offering certain brokerage services and allows them to provide those services without registering themselves as a...

Regulation Q – Explained

by TheBusinessProfessor | Feb 23, 2025 | Banking, Lending, and Credit Industry

Update Table of Contents What is Regulation Q?How Does Regulation Q Work? What is Regulation Q?Regulation Q is a Federal Reserve Board Regulation imposing restrictions on the payment of interest on checking accounts. The rule was adopted in 1933 and prohibits banks...

Regulation M – Explained

by TheBusinessProfessor | Feb 23, 2025 | Business Taxation

What is Regulation M?Regulation M allows regulated investment companies to avoid double taxation by passing taxes from capital gains, dividends, and interest distributions onto individual investors. It is an Internal Revenue Service Regulation applied to all...