Archives: Terms

Definition of Overtrading Overtrading refers to a situation where a company engages in more business activities than it can sustain with its available financial resources or operational capacity. This often occurs when a company expands its operations excessively or takes on too much work without adequate capital, leading to potential […]

Definition of Overseas Investment Overseas investment refers to the allocation of financial resources by individuals, companies, or governments into business interests, real estate, or other types of assets in countries other than their own. This type of investment can take various forms, including direct investment in foreign business operations, purchasing […]

Definition of Overseas Bank An overseas bank refers to a banking institution that operates outside of its home country, providing a wide range of financial services across international borders. These services may include traditional banking operations, such as deposit taking and lending, as well as foreign exchange transactions, international money […]

Definition of Overmanning Overmanning refers to a situation where there are more employees within an organization than are necessary to efficiently carry out its operations. This condition often leads to reduced productivity and increased costs for the company. Overmanning can occur for various reasons, such as reluctance to lay off […]

Definition of Overlapping Generations Economy An Overlapping Generations Economy (OLG) refers to a model used in economics to describe a situation where individuals live through multiple periods and thus, different generations overlap each other. It contrasts with infinitely-lived agent models, where hypothetical individuals or agents never die but keep consuming […]

Definition of Overheating Overheating in an economic context refers to a scenario where the economy grows at an unsustainable pace, leading to high inflation and potentially causing a bubble. This occurs when the level of spending exceeds the economy’s capacity to produce goods and services, resulting in increased prices. Overheating […]

Definition of Overhead Costs Overhead costs, often called indirect costs, refer to expenses that are not directly attributable to a specific product or service but are necessary for running a business. These costs are essential for a company’s day-to-day operational functions but do not directly generate profit. They include rent, […]

Definition of Over-valued Currency An over-valued currency refers to a situation where a country’s currency has a higher value on the international exchange market than its economic fundamentals justify. This condition often results from a fixed or pegged exchange rate system where the government or central bank keeps the currency’s […]

Definition of Over-The-Counter Market An over-the-counter (OTC) market refers to a decentralized market where trading of financial instruments, such as stocks, bonds, commodities, and currencies, takes place directly between two parties without the supervision of an exchange. Transactions in an OTC market are conducted via dealer networks where market participants […]

Definition of Over-subscription Over-subscription occurs when the demand for a company’s shares in an Initial Public Offering (IPO) or any new issue of shares exceeds the number of shares available for sale. This scenario indicates a high level of interest and perceived value in the company by investors. Over-subscription is […]