What Is Revenue Per Available Room (RevPAR)? Revenue per available room (RevPAR) is a metric used in the hospitality industry to measure hotel performance. The measurement is calculated by multiplying a hotel’s average daily room rate (ADR) by its occupancy rate. RevPAR is also calculated by dividing a hotel’s total room revenue by the total
What Was the Reconstruction Finance Corporation (RFC)? The Reconstruction Finance Corp. (RFC) was an agency authorized by the U.S. government to loan money to assist the nation’s ailing banks after the stock market crash of 1929 and during the Great Depression that followed. Congress created the RFC in 1932 with a limited mandate to issue emergency
What Is Recency, Frequency, Monetary Value (RFM)? Recency, frequency, monetary value (RFM) is a model used in marketing analysis that segments a company’s consumer base by their purchasing patterns or habits. In particular, it evaluates customers’ recency (how long ago they made a purchase), frequency (how often they make purchases), and monetary value (how much money
What Is the Risk-Free Rate Puzzle (RFRP)? The risk-free rate puzzle (RFRP) is a market anomaly observed in the persistent difference between the lower historic real returns of government bonds compared to equities. This puzzle is the inverse of the equity premium puzzle and looks at the disparity from the perspective of the lower returning
What Is Rho? Rho is the rate at which the price of a derivative changes relative to a change in the risk-free rate of interest. Rho measures the sensitivity of an option or options portfolio to a change in interest rate. Rho may also refer to the aggregated risk exposure to interest rate changes that
What Is a Registered Investment Advisor (RIA)? A registered investment advisor (RIA) is a firm that advises clients on securities investments and may manage their investment portfolios. RIAs are registered with either the U.S. Securities and Exchange Commission (SEC) or state securities administrators. RIAs have fiduciary obligations to their clients, meaning that they have a
What Is Riba? Riba is an Arabic word that means “to increase” or “to exceed” and is commonly used in reference to unequal exchanges or charges and fees for borrowing. Interest is deemed riba, or an unjust, exploitative gain, and such practice is forbidden under Islamic law. Key Takeaways In Islamic finance, riba refers to interest
What Is a Regulated Investment Company (RIC) A regulated investment company (RIC) can be any one of several investment entities. For example, it may take the form of a mutual fund or exchange-traded fund (ETF), a real estate investment trust (REIT), or a unit investment trust (UIT). Whichever form the RIC assumes, the structure must
What Is Ricardian Equivalence? Ricardian equivalence is an economic theory that says that financing government spending out of current taxes or future taxes (and current deficits) will have equivalent effects on the overall economy. This means that attempts to stimulate an economy by increasing debt-financed government spending will not be effective because investors and consumers
What Is the Ricardo-Barro Effect? The Ricardo-Barro effect, also known as Ricardian equivalence, is an economic theory that suggests that when a government tries to stimulate an economy by increasing debt-financed government spending, demand remains unchanged, because the public increases their saving to pay for expected future tax increases that will be used to pay
