What is the Competitive Forces Model? The Competitive Forces Model is an important tool used in strategic analysis to analyze the competitiveness in an industry. The model is more commonly referred to as the Porter’s Five Forces Model, which includes the following five forces: intensity of rivalry, threat of potential new entrants, bargaining power of…
What is Market Planning? Market planning is the process of organizing and defining the marketing aims of a company and gathering strategies and tactics to achieve them. A solid marketing plan should consist of the company’s value proposition, information regarding its target market or customers, a comparative positioning of its competitors in the market, promotion…
What is a Macro Environment? A macro environment refers to the overall, broader economy and the forces affecting it versus a microenvironment, which focuses on a specific sector or region’s economy. There are macroeconomic conditions or factors that affect how all businesses operate, which, in turn, affect the economy as a whole. In general, macroeconomics deals…
What is Mortgage Recast? Mortgage recast (also known as loan recast or re-amortization) is a strategy by which homeowners can reduce their monthly mortgage payments and save on the interest paid over the life of the loan. It allows borrowers to pay a large, lump-sum amount toward their principal in order to reduce their monthly…
What is the Multilateral Investment Guarantee Agency (MIGA)? The Multilateral Investment Guarantee Agency, abbreviated as MIGA, is an international agency constituted to promote large scale foreign investment projects in developing countries. MIGA specializes in facilitating high-risk investments in low-income countries and supports projects that are socially, economically, and environmentally sustainable. Headquartered in Washington DC, U.S., MIGA is…
What is Quantitative Tightening? Quantitative tightening, also known as balance sheet normalization, is a type of monetary policy followed by central banks. It simply means that a central bank reduces the pace of reinvestment of proceeds from maturing government bonds, and is the exact opposite as the monetary stance of quantitative easing. Quantitative tightening also…
What is Crisis Management? Crisis management involves dealing with crises in a manner that minimizes damage and enables the affected organization to recover quickly. Dealing properly with a crisis can be especially important for a company’s public relations. Crises come in several forms, and it is recommended that a company be prepared ahead of time…
What is Monetarism? The term monetarism refers to a macro-economic concept, according to which government intervention in the economy in the form of the management of money supply is key to economic stability. The premise of monetarism lies in the idea that the total amount of money in circulation in an economy determines the rate…
What is the Average Collection Period? The average collection period amount of time that passes before a company collects its accounts receivable (AR). In other words, it refers to the time it takes, on average, for the company to receive payments it is owed from clients or customers. The average collection period must be monitored…
What is an Auction Market? An auction market is a market where the price is determined by the highest price the buyer is willing to pay (bids), and the lowest price the seller is willing to take (offers). Bids and offers are matched for a trade to occur. How Auction Markets Work Auction markets are…
