Devaluation (Money)

Devaluation refers to a decline in the value of a currency in relation to another, usually brought about by the actions of a central bank or monetary authority. Devaluation is sometimes used more generally to describe any significant drop in a currency's international exchange rate, although usually a decline caused by market forces with no government intervention is termed a depreciation.

Development Banks

Development banks include multibillion-dollar entities like the World Bank, but most are smaller regional and local lenders spread throughout the world. They exist to fund projects that improve the material well-being of people, particularly those living in poverty.

Direct Investment

Direct investment generally refers to situations in which a company has established manufacturing facilities in another country, either through a wholly owned subsidiary or as a joint venture partner with a partial ownership stake. Direct investments are governed by the laws of both the country in which the parent company is domiciled and the country in which the subsidiary does business.

Direct Mail

Newcomers to the field of direct mail often use the terms "direct mail," "direct marketing," and "mail order" interchangeably. Perhaps the best way to distinguish these three similar, yet different, terms is to remember that direct mail is simply an advertising medium like print or broadcast media.

Direct Marketing

According to the official definition of the Direct Marketing Association (DMA), direct marketing is an "interactive system of marketing which uses one or more advertising media to effect a measurable response and/or transaction at any location." While there are many other definitions of direct marketing, the DMA definition captures four basic concepts of direct marketing.

Disclosure Laws and Regulations

Companies that are privately owned are not required by law to disclose detailed financial and operating information. They have a wide latitude in deciding what types of information to make available to the public.

Discount Broker

Once viewed as spartan, amateurish services, discount brokerages have emerged as a potent and lucrative force in the U.S. securities brokerage industry, aided most recently by the popularity of Internet-based trading.

Discount Rate

The term "discount rate" has different meanings depending on the context in which it is used. In one sense the discount rate may simply refer to the interest rate used in present value calculations.

Discounted Cash Flow

Discounted cash flow (DCF) is one of the most important concepts underlying financial decision making. Also known as the "time value of money," DCF applies to any situation in which money is paid at one point and received at a different point.

Discretionary Income

Discretionary income is the money an individual or household has left for spending after basic needs are met. It is not the same as disposable income, which is an individual's net income after taxes, but rather a component of disposable income.

Discriminant Analysis

Discriminant analysis is a statistical method that is used by researchers to help them understand the relationship between a "dependent variable" and one or more "independent variables." A dependent variable is the variable that a researcher is trying to explain or predict from the values of the independent variables. Discriminant analysis is similar to regression analysis and analysis of variance (ANOVA).

Distinctive Competence

Distinctive competence is a set of unique capabilities that certain firms possess allowing them to make inroads into desired markets and to gain advantage over the competition; generally, it is an activity that a firm performs better than its competition. To define a firm's distinctive competence, management must complete an assessment of both internal and external corporate environments.

Diversification in Investments

Diversification refers to the reduction in the overall risk of an investor's portfolio even when it is comprised of a number of highly risky individual investments. The risk in a group of investments may be lower than the risk associated with any individual element in the group.

Diversity Culture

The term "diversity" refers to the way in which people differ from one another. Since such differences affect the way people interact in the workplace, diversity management is a factor for most organizations.


Divestment is closely related to the concept of divestiture. In fact, the two terms can be—and often are—used interchangeably.

Dividend Policy

Dividend policy refers to the decision regarding the magnitude of the dividend payout, the percentage of earnings paid to the stockholders in the form of dividends. The central, and as yet unresolved, issue concerning dividend policy is whether changes affect firm value.


Companies usually pay dividends every quarter, or four times per year. When the company is about to pay a dividend, the company's board of directors makes a dividend announcement that indicates the amount of the dividend, the date of record, and the date of payment.

Due Diligence

Generally, due diligence is the care that people with normal discretion employ in all of their dealings in order to avoid damage to others or to themselves. In business, the term refers to the prudent inspection of anything intended for purchase.


Dumping is a term that is used in financial markets as well as in international trade. In the context of buying and selling securities, dumping refers to the practice of selling large blocks of securities.


A duopoly refers to a market where there are only two firms selling a particular product, service, or commodity. It is a special case of an oligopoly, which is a market condition where the production of identical or similar products is concentrated in a few large firms.

Durable Goods

Durable goods are those that are not consumed immediately, but which gradually wear out during the period they are used. The U.S.


Duration is a measure of the price sensitivity of a fixed income security to changes in the interest rate. It was developed by Frederick R.


A duty is a tax imposed by a government on imported or exported goods. The terms "duty" and "tariff are often used synonymously, but a duty is the actual tax imposed on goods while a tariff is the schedule of duties.

Earnings Forecasts

The forecasting of a company's earnings is important to a firm, its creditors, and its investors. The business usually prepares its annual earnings forecast as part of its budget process.

East African Community (EAC)

The East African Community (EAC), an economic cooperative, was formed by the African countries of Kenya, Tanzania, and Uganda in 1967. Prior to gaining independence these three countries had been under British colonial rule.

Eastern Europe, Doing Business in

Since the fall of the Berlin Wall in 1989 and the subsequent retreat of Soviet dominance back to the Russian border, profound economic changes have come about in Eastern Europe. Fledgling market economies, while facing many problems, are striving to fill the vacuum left by the now-defunct communist regimes.


Econometrics applies the methodology of mathematical statistics and tools of statistical inference to the empirical implementation of models of economic activity postulated by economic theory. Econometrics is a major field within the discipline of economics (other major fields are economic theory, macroeconomics, industrial organization, labor economics, public economics, development economics, and international economics).

Economic Community of West African States (ECOWAS)

The Economic Community of West African States (ECOWAS) was established May 28, 1975, with the signing of the Treaty of Lagos in that Nigerian city. The community, headquartered in Lagos, has 16 members: Benin, Burkina Faso, Cape Verde Islands, Gambia, Ghana, Guinea, Guinea-Bissau, Ivory Coast, Liberia, Mali, Mauritania, Niger, Nigeria, Senegal, Sierra Leone, and Togo.