Your Free Online Legal Dictionary • Featuring Black’s Law Dictionary, 2nd Ed.

Category: Finance Dictionary

LONG SQUEEZE

A downward stock price trend accelerated by attempted long position liquidations by investors, hoping to minimize their losses. Also refer to short squeeze.

LONG-RUN AGGREGATE SUPPLY

in a specific period of time, produced and tracked across the national economy, this is the total amount of goods and services .

LOSS CONSTANT

Compared to other risks in the same classification, this amount intends to offset greater-than-average losses most smaller risks have.

LOSS LIMITATION

Retrospective rating formulas component. Calculating the final premium with a designed catastrophic losses limit versus full hit reporting.

LOSS RESERVE

Insurer’s estimated time-bound total unpaid claim liability as held money. Includes unreported claim events, committed unpaid rulings, and payouts committed yet not due.

LOW RISK FOODS

Foods less of a source of food poisoning, containing (1) high acid content of pH 4.5 or lower, or (2) low water content. Low risk foods usually have a ‘best before’ date

LUMP SUM BID

Single value bid. Expected to cover all cost for the project involved. Includes equipment, labor, material, overheads, and services, as well as the contractor’s fee or bonus for completing the items of

MACHINE BUREAUCRACY

Typical in large, established organizations that have formalization and specialization at a high degree. Top level making decisions, lower levels mechanically carrying then out is this type of management structure.

MACROECONOMICS

A subject of study. Macro is the behavior of entire, aggregated economies or economic systems. In contrast, Micro is the behavior of individuals, individual firms, or more local markets. National income forecasting,

MAIN STREET

1. Descriptive term for the average working middle-class American. 2. Typically a city or town’s primary street.

MAJOR VIOLATION

In auto insurance, this is an event that could lead to jail-time and/or severe penalties: driving under the influence of alcohol, driving with a revoked or suspended license, an unlicensed driver driving

MALPRACTICE LIABILITY INSURANCE

Insurance coverage for a doctor, surgeon, psychiatrist, psychologist, nurse, a hospital, other medical/healthcare professional or institution if guilty of dereliction of duty due to negligence or incompetence. Pays for the defense of

MANAGEMENT RISK

Potential risk tied to company managers’ decisions made in the interest of shareholders and the company at large. Poor decisions or self-serving decisions made by management will potentially destroy shareholder wealth.

MAN-MONTH

A 4-week period of one person’s productive effort represented as a unit of work. Also known as labor month.

MANUFACTURING SECTOR

Industries making chemical, mechanical, physical material transformations, substances, and components into consumer and industrial goods. This is known to be an uncoordinated and highly competitive collection of industries.

MARGINAL COST OF PRODUCTION

Production’s total costs change due to making or producing a single additional item. This cost helps to isolate an optimum production level and to determine the point a company achieves economies of

MARGINAL PROPENSITY TO CONSUME

A small, disposable income’s change proportion potentially spent on consumption instead of being saved. Divide the consumption change by the causal disposable income change.

MARGRABE OPTION

US risk-management consultant William Margrabe invented this in 1978. Exchanging of one asset for another as the basis of a futures contract, like a cross currency option. He also devised a price

MARKETABLE TITLE

ownership Claim defect-free, claim-free, and lien-free. Asset or property owner can freely sell it. Also known as good title.

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