Arithmetic Mean
What is the Arithmetic Mean? The arithmetic mean is the average of a sum of numbers, which reflects the central tendency of the position of the numbers. It is often used as a parameter in statistical distributions or as a result to summarize the observations of an experiment or a survey. There are several types...
External Growth
What is External Growth? External growth (also known as inorganic growth) refers to growth of a company that results from using external resources and capabilities rather than from internal business activities. External growth is an alternative to internal (organic) growth. However, internal and external growth should not be considered opposites. The main advantage...
Merger
What is a Merger? A merger is a corporate strategy to combine with another company and operate as a single legal entity. The companies agreeing to mergers are typically equal in terms of size and scale of operations. Why Do Mergers Happen? After the merger, companies will secure more resources and the scale of operations...
Mezzanine Financing
What is Mezzanine Financing? Mezzanine financing is a layer of financing that fills the gap between senior debt and equity in a company. It can be structured either as preferred stock or as unsecured debt, and it provides investors with an option to convert to equity interest. Mezzanine financing is usually used to fund growth...
Ponzi Scheme
What is a Ponzi Scheme? A Ponzi scheme is considered a fraudulent investment program. It involves using payments collected from new investors to pay off the earlier investors. The organizers of Ponzi schemes usually promise to invest the money they collect to generate supernormal profits with little to no risk. However, in the real sense,...
