What Is Collaborative Consumption? Collaborative consumption is the shared use of a good or service by a group. Whereas with normal consumption an individual pays the full cost of a good and maintains exclusive access to it, with collaborative consumption multiple people have access to a good and bear its cost. A common example is
What Is a Collar? A collar, also known as a hedge wrapper or risk-reversal, is an options strategy implemented to protect against large losses, but it also limits large gains. An investor who is already long the underlying creates a collar by buying an out-of-the-money put option while simultaneously writing an out-of-the-money call option. The put
What Is Collateral? Collateral in the financial world is a valuable asset that a borrower pledges as security for a loan. When a homebuyer obtains a mortgage, the home serves as the collateral for the loan. For a car loan, the vehicle is the collateral. A business that obtains financing from a bank may pledge
What Is Collateralization? Collateralization is the use of a valuable asset as collateral to secure a loan. If the borrower defaults on the loan, the lender may seize and sell the asset to offset their loss. For lenders, the collateralization of assets provides a level of reassurance against default risk. For borrowers with poor credit
The Collateral Source Rule: An Overview The collateral source rule is a law in state jurisdictions that prevents the reduction of damages awarded to a plaintiff for injury, illness, or disability by the amount already recovered from a third party such as an insurer. The rule varies by state but generally mandates that damages awarded
What Is a Collectible? A collectible refers to an item worth far more than it was initially sold for because of its rarity and/or popularity. The price for a particular collectible usually depends on how many of the same items are available and its overall condition. Common categories of collectibles include antiques, toys, coins, comic
What Is a Collection Agency? A collection agency is a company used by lenders or creditors to recover funds that are past due, or from accounts that are in default. Often, a creditor will hire a collection agency after it has made multiple failed attempts to collect its receivables. A lender may outsource the debt-collection
What Is Collection-Proof? “Collection-proof” is a term to describe a person who has no income or assets that can legally be seized for debt repayment. In essence, the debtor doesn’t have any assets that a creditor can collect after a court requires the debtor to pay. A creditor who obtains a judgment can attempt to garnish a
What Is Collective Bargaining? The term “collective bargaining” refers to the negotiation of employment terms between an employer and a group of workers. Employees are normally represented by a labor union during collective bargaining. The terms negotiated during collective bargaining can include working conditions, salaries and compensation, working hours, and benefits. The goal is to
What Is the College Level Examination Program (CLEP)? CLEP stands for the College Level Examination Program, a program that enables students to earn college credit for introductory-level courses by achieving satisfactory scores on subject-specific tests. CLEP is administered by College Board, the same company that administers the Scholastic Assessment Test (SAT) required for seeking admission
