What Is Heteroskedasticity? In statistics, heteroskedasticity (or heteroscedasticity) happens when the standard deviations of a predicted variable, monitored over different values of an independent variable or as related to prior time periods, are non-constant. With heteroskedasticity, the tell-tale sign upon visual inspection of the residual errors is that they will tend to fan out over time
What Are Heuristics? A heuristic is a mental shortcut commonly used to simplify problems and avoid cognitive overload. Heuristics are part of how the human brain evolved and is wired, allowing individuals to quickly reach reasonable conclusions or solutions to complex problems. These solutions may not be optimal ones, but are often sufficient given limited timeframes
What Is the Herfindahl-Hirschman Index (HHI)? The Herfindahl-Hirschman Index (HHI) is a common measure of market concentration and is used to determine market competitiveness, often pre- and post-merger and acquisition (M&A) transactions. The index measures the size of companies relative to the size of the industry they are in and the amount of competitiveness. The
What Is the Hong Kong Interbank Offered Rate (HIBOR)? The Hong Kong Interbank Offered Rate, known by its abbreviation HIBOR, is the benchmark interest rate, stated in Hong Kong dollars, for lending between banks within the Hong Kong market. The HIBOR is a reference rate for lenders and borrowers that participate directly or indirectly in
What Is the Harmonized Index of Consumer Prices (HICP)? The Harmonized Index of Consumer Prices (HICP) is a measure of inflation in the European Union (EU). It reflects change over time in the prices paid by households for a representative basket of goods and services. The European Central Bank (ECB) uses the HICP for the
What Are Hidden Taxes Hidden taxes are taxes indirectly assessed on consumer goods without the explicitly knowledge of consumers who purchase the product. At the heart of the concept of a hidden tax is the notion that if you cannot see it, your purchasing behavior will be largely unchanged. With the advent of modern transactional systems, visibility
What Are Hidden Values? Hidden values are assets that are undervalued on a company’s balance sheet and therefore may not be incorporated into or reflected in the company’s share price. So-called value investors seek to uncover hidden values on a company’s balance sheet that are often overlooked by the average investor, often through the use
The hierarchy-of-effects theory is a model of how advertising influences a consumer’s decision to purchase or not purchase a product or service. The hierarchy represents the progression of learning and decision-making consumer experiences as a result of advertising. A hierarchy-of-effects model is used to set up a structured series of advertising message objectives for a
What Is the Hierarchy of GAAP? The hierarchy of generally accepted accounting principles (GAAP) refers to a four-level framework that classifies the Financial Accounting Standards Board (FASB), the U.S. Securities and Exchange Commission (SEC), and the American Institute of Certified Public Accountants (AICPA) guidance on accounting practices and standards by their level of authority. Top-level
High-yield bonds are debt securities, also known as junk bonds, that are issued by corporations. They can provide a higher yield than investment-grade bonds, but they are also riskier investments. What Are High-Yield Bonds? High-yield bonds (also called junk bonds) are bonds that pay higher interest rates because they have lower credit ratings than investment-grade
