Negotiable Order of Withdrawal (NOW)
What is a Negotiable Order of Withdrawal (NOW)? A negotiable order of withdrawal, also known as a NOW account, is a type of deposit account that provides interest and allows the depositor to write drafts against the money that is held on deposit. In the U.S, commercial banks, lending associations, and mutual savings…
Negotiable Certificate of Deposit (NCD)
What is a Negotiable Certificate of Deposit (NCD)? A negotiable certificate of deposit (NCD) refers to a certificate of deposit with a minimum par value of $100,000, although typically, NCDs will carry a much higher face value. They are also known as jumbo CDs. NCDs are guaranteed by a bank and can be traded in…
Household
What is a Household? A household refers to a social unit of people who live together under one roof and share resources, even if they are not related to each other. In the US, the Census Bureau categorizes households as family or non-family. A family household comprises members who are related by blood, whereas a…
Negotiated Dealing System (NDS)
What is the Negotiated Dealing System (NDS)? The Negotiated Dealing System (NDS) is a fully electronic trading platform that is instituted and operated by the Reserve Bank of India (RBI) with the mandate of facilitating the issuance and secondary trading of government-issued securities and other types of money market instruments. In February 2002,…
Adjusting Journal Entry
What is an Adjusting Journal Entry? An adjusting journal entry is usually made at the end of an accounting period to recognize an income or expense in the period that it is incurred. It is a result of accrual accounting and follows the matching and revenue recognition principles. Generally, adjusting journal entries are made for…
Macaulay Duration
What is Macaulay Duration? Macaulay duration is the weighted average of the time to receive the cash flows from a bond. It is measured in units of years. Macaulay duration tells the weighted average time that a bond needs to be held so that the total present value of the cash flows received is equal…
Cross-Sectional Data Analysis
What is Cross-Sectional Data Analysis? Cross-sectional data analysis is when you analyze a data set at a fixed point in time. Surveys and government records are some common sources of cross-sectional data. The datasets record observations of multiple variables at a particular point in time. Understanding Cross-Sectional Data Analysis in Finance Financial analysts may, for example,…
Amortization Schedule
What is an Amortization Schedule? An amortization schedule is a table that provides both loan and payment details for a reducing term loan. Details typically include the original loan amount, the loan balance at each payment, the interest rate, the amortization period, the total payment amount, and the proportion of each payment that is made…
Fair Credit Billing Act (FCBA)
What is the Fair Credit Billing Act? The Fair Credit Billing Act (FCBA) is a federal law that mandates the protection of consumers from exploitation by creditors through billing errors. Enacted in 1974, the FCBA was introduced as an amendment to the Truth in Lending Act (1968). The Fair Credit Billing Act provides a mechanism…
