What is Regulation M? Regulation M allows regulated investment companies to avoid double taxation by passing taxes from capital gains, dividends, and interest distributions onto individual investors. It is an Internal Revenue Service Regulation applied to all investment companies operating in the United States that are registered under the Investmen...

What is the McCallum Rule? The McCallum rule is a monetary policy rule that specifies the level of the monetary base a central bank can maintain in a country. This rule explains the interaction between the total amount in the monetary base and a country's inflation. Bennett T. McCallum proposed the McCallum Rule towards the end of the 20thcentury. I...

What is an Asset-Liability Committee? An asset-liability committee (ALCO) is a committee that handles the asset-liability and risk management affairs of a bank or a financial institution. ALCO functions as a decision-making body, a supervisory group, evaluation committee and risk-management committee for a bank or any other lending institution. An a...

What is an Advance Rate? An advance rate is a percentage of the value of the collateral set by the lender, up to which the lender agrees to extend the loan amount. When a lender provides a loan against collateral that has a fluctuating value, the lender needs a predetermined advance rate to protect themselves from loss. Depending on the advance rate...

What is Subpart F Income? Income generated Controlled Foreign Corporations (CFCs) by the United States government is called as Subpart F Income. CFCs are foreign subsidiaries with more than 50% stake controlled by entities in the United States, and taxed as per the Subpart F code of the US Tax code laws. How Does Subpart F Income Work? While it is a...

What is the Asian Development Bank? The Asian Development Bank was founded on 19 December 1966, with the aim of fostering economic development and cooperation among countries in the Asian and Pacific Region. ADB has its headquarters in Manila, Philippines, it is an organization prides itself as a social development organization. ADB has executed num...

What is an Asset-Conversion Loan? This is a short-term loan that is paid for by selling an identified asset (such as inventory). They are common with seasonal businesses that take out these loans to pay for inventory to be sold in a specific period, such as holiday apparel. Back to:BANKING, LENDING, & CREDIT INDUSTRY How Does an Asset-Conversion...

What is Market Structure?  Market structure concerns how competitive is the industry. That is, it concerns the following factors: Market power of each firm (suppliers and buyers); Substitute products; Barriers to entry; Competitive rivalry  It also concerns the number of other firms in the market.  Relate Topics Theory of the Firm Capital Formation ...

What is the Throwback Rule? The throwback rule is a tax rule that allows a state to tax a corporation or business entity for the profits made in the state. Corporations, whose sales originate from certain states are subject to tax payment on those sales under the throwback rule. Also, the throwback rule allows states to tax corporations for their fa...

How to Grant Common Stock A company must undertake several steps in order to grant stock. The primary steps are as follows: What is the Board Approval? The board of directors must approve any issuance or grant of stock. The bylaws will generally lay out the number or percentage of shareholders who must approve such a grant. In some case, the bylaws ...