What Is a Subscription Right? A subscription right is the right of existing shareholders in a company to retain an equal percentage ownership by subscribing to new stock issuances at or below market prices. The subscription right is usually enforced by the use of rights offerings, which allow shareholders to exchange rights for shares of common
What Is a Subsequent Offering? The term subsequent offering refers to the issuance of additional stock shares after a company has already gone public through an initial public offering (IPO). Subsequent offerings are, thus, made by companies that are already publicly traded or by an existing shareholder. These offerings are commonly made on a stock
What Is a Subsidiary? In the corporate world, a subsidiary is a company that belongs to another company, which is usually referred to as the parent company or the holding company. The parent holds a controlling interest in the subsidiary company, meaning it has or controls more than half of its stock. In cases where a
What Is a Subsidiary Bank? A subsidiary bank is a type of foreign entity that is located and incorporated in a foreign country but is either wholly-owned or owned in a major part by a parent corporation in a different nation. This particular banking model helps the parent company avoid unfavorable regulations enforced by the home country.
What Is a Subsidy? A subsidy is a benefit given to an individual, business, or institution, usually by the government. It can be direct (such as cash payments) or indirect (such as tax breaks). The subsidy is typically given to remove some type of burden, and it is often considered to be in the overall
What Is a Substandard Insurance? An individual who may not qualify for a standard insurance policy may receive a substandard insurance policy from an insurance provider. Substandard insurance policies contain special or restrictive provisions and will have higher premiums due to the higher risk posed by the individual. Since they are considered a higher risk, it increases the probability
What Is Substantial Gainful Activity (SGA)? Substantial gainful activity (SGA) represents the monthly threshold salary used by the U.S. Social Security Administration (SSA) to qualify individuals for disability benefits. The SSA updates the dollar amount annually to reflect inflation (or rising prices) and generally maintains a higher threshold for statutorily blind individuals. Key Takeaways The
What Is a Substitute? A substitute, or substitutable good, in economics and consumer theory refers to a product or service that consumers see as essentially the same or similar-enough to another product. Put simply, a substitute is a good that can be used in place of another. Substitutes play an important part in the marketplace and are
What Are Substitute Checks? Substitute checks are copies of checks used by banks in lieu of the original. This practice was made legal by the Check Clearing for the 21st Century Act in 2003, better known as the Check 21 Act. Provided that the copy includes both the front and the back of the original
What Is the Substitution Effect? The substitution effect is the decrease in sales for a product that can be attributed to consumers switching to cheaper alternatives when its price rises. A product may lose market share for many reasons, but the substitution effect is purely a reflection of frugality. If a brand raises its price
