Archives: Terms

Definition of Tied Aid Tied aid refers to the practice of extending financial assistance to a foreign country with the stipulation that the funds must be used to purchase goods or services from the donor country. This form of aid is designed to promote the donor country’s economic interests while […]

Definition of Tiebout Hypothesis The Tiebout Hypothesis, named after economist Charles Tiebout, suggests that individuals “vote with their feet” by moving to jurisdictions that best cater to their preference for public goods and tax levels. This hypothesis proposes that when people can move freely across different communities or municipalities, they […]

### Title: Thrifts Definition of Thrifts Thrifts, also known as thrift institutions or savings and loan associations, are financial institutions that focus on taking deposits and originating residential mortgages. These institutions tend to operate similarly to commercial banks but have a financial structure that is more heavily concentrated on housing-related […]

Definition of Thrift Thrift is defined as the quality of using money and other resources carefully and not wastefully. It is a term often synonymous with frugality and economical living. Practicing thrift involves managing expenses, making smart financial choices, and conserving resources to achieve financial stability and improve economic well-being. […]

Definition of Third-Party Insurance Third-party insurance is a type of liability insurance that provides coverage to the insured person for the risks and damages they may cause to others (third parties) due to their actions or negligence. In the context of auto insurance, for example, third-party insurance covers the costs […]

Definition of Third-Degree Price Discrimination Third-degree price discrimination is a pricing strategy where a seller charges different prices to different segments of consumers for the same product or service. These segments are typically divided based on specific characteristics such as age, location, occupation, or purchase quantity. Unlike first-degree price discrimination, […]

Definition of Discount Rate The discount rate is the interest rate used to determine the present value of future cash flows. Essentially, it is the rate at which money loses value over time due to factors like inflation and opportunity cost. The discount rate is commonly used in various fields […]

Definition of Term Structure of Interest Rates The term structure of interest rates, also known as the yield curve, represents the relationship between the interest rates (or yields) of bonds of different maturities, typically government bonds, such as U.S. Treasury securities. In essence, the term structure shows how the yield […]

Definition of Term Premium The term premium refers to the additional return that investors require for holding a longer-term bond as opposed to a series of shorter-term bonds. This reflects the risks associated with long-term investments, such as interest rate risk and inflation risk. In essence, it compensates investors for […]

Definition of Term Loan A term loan is a type of loan that is provided with a specific repayment schedule and a fixed or variable interest rate. These loans are often used by businesses to purchase fixed assets such as machinery, equipment, or buildings. Term loans are typically structured with […]