What Is a Probability Density Function (PDF)? Probability density function (PDF) is a statistical expression that defines a probability distribution (the likelihood of an outcome) for a discrete random variable (e.g., a stock or ETF) as opposed to a continuous random variable. The difference between a discrete random variable is that you can identify an exact value of
What Is the P/E 10 Ratio? The P/E 10 ratio is a valuation measure generally applied to broad equity indices that use real per-share earnings over 10 years. The P/E 10 ratio also uses smoothed real earnings to eliminate the fluctuations in net income caused by variations in profit margins over a typical business cycle.
What Is a Peace Dividend? A peace dividend is an economic boost a country will get from a peace that follows a war. In theory, at that time the government can afford to reduce defense spending and reallocate the money to domestic policy priorities. This assumes that the money recouped from defense spending is generally used
What Is a Peak? A peak is the highest point between the end of an economic expansion and the start of a contraction in a business cycle. The peak of the cycle refers to the last month before several key economic indicators, such as employment and new housing starts, begin to fall. It is at
What Is a Patent Troll? A patent troll is a derogatory term used to describe a company that uses patent infringement claims to win court judgments for profit or to stifle competition. The term may be used to describe a number of business activities that utilize patents and the court system to earn money. While
What Is the Protecting Americans From Tax Hikes (PATH) Act? The Protecting Americans from Tax Hikes (PATH) Act of 2015 was an Obama-era law that expanded or renewed several tax credits for individuals, families, and businesses while implementing measures to prevent fraudulent claims for those credits. The act remains in force. The act primarily affects
What Is the USA PATRIOT Act? The Patriot Act, or USA PATRIOT Act, was passed shortly after the terrorist attacks in the United States that occurred on September 11, 2001, and gave law enforcement agencies broader powers to investigate, indict, and bring terrorists to justice. It also led to increased penalties for committing and supporting terrorist
What Is a Patronage Dividend? A patronage dividend, also known as a patronage refund, is a distribution that a cooperative pays to its members or investors. Patronage dividends are given based on a proportion of profit that the business makes. Once this amount is determined, management calculates the dividend according to how much each member
Paul Krugman is a Neo-Keynesian economist, Nobel laureate, academic, author, and media columnist, known for his work on international trade theory and economic geography. Considered one of the world’s most influential economists, Krugman is renowned for redefining existing theories of international trade and either founding or co-founding several new disciplines in international economics, from New
What Is Payable on Death (POD)? Payable on death (POD) is an arrangement between a bank or credit union and a client that designates beneficiaries to receive all of the client’s assets. The immediate transfer of assets is triggered by the death of the client. Though morbid, these structures are important to understand. Payable on
