What Is the Present Value of an Annuity? The present value of an annuity is the current value of future payments from an annuity, given a specified rate of return, or discount rate. The higher the discount rate, the lower the present value of the annuity. Present value (PV) is an important calculation that relies on the concept
What Is the Presidential Election Cycle Theory? The presidential election cycle theory, developed by Stock Trader’s Almanac founder Yale Hirsch, posits that equity market returns follow a predictable pattern each time a new U.S. president is elected. According to this theory, U.S. stock markets perform weakest in the first year, then recover, peaking in the
What Is a Press Conference? A press conference is an event organized to officially distribute information and answer questions from the media. Press conferences are also announced in response to specific public relations issues. Corporate press conferences are generally led by the company’s executive management, press liaison, or communications officer. Given limited resources, particularly during
What Is a Press Release? A press release is a piece of news or information that companies send out to inform the public about something noteworthy or of material significance. Press releases are often handled by a company’s public relations (PR) department. Companies issue press releases, which may be spread to a wider audience through
What Is the Pretax Rate of Return? The pretax rate of return is the return on an investment that does not include the taxes the investor must pay on this return. Because individuals’ tax situations differ and different investments attract varying levels of taxation, the pretax rate of return is the measure most commonly cited
What Is the Previous Balance Method? The term “previous balance method” describes one of many methods for calculating interest payments that are used by credit card companies. Under the previous balance method, the amount of interest charged each month is based on the balance of debt outstanding on the card as of the beginning of
What Is Price Continuity? Price continuity is a characteristic of a liquid market in which the bid-ask spread, or difference between offer prices from buyers and requested prices from sellers, is relatively small. Price continuity reflects a liquid market, for which there are many buyers and sellers for a given security. Price continuity should not
What Is Price Level? Price level is the average of current prices across the entire spectrum of goods and services produced in an economy. In more general terms, price level refers to the price or cost of a good, service, or security in the economy. Price levels may be expressed in small ranges, such as
What Is Price Level Targeting? Price level targeting is a monetary policy framework that can be used to achieve price stability. LPrice level targeting is a technique in monetary policy, where the central bank increases or decreases the supply of money and credit in the economy in order to achieve a specified price level. Price
What Is Price Rigging? Price rigging occurs when parties conspire to fix or inflate prices to achieve higher profits at the expense of the consumer. Also known as “price fixing” or “collusion,” price rigging can take place in any industry and is usually illegal. As a term, “price rigging” is most commonly used in British
