Promissory Note

A promissory note is a written agreement from one party to another that promises the payment of a specific amount of money on a specified date. A promissory note is an alternative means of obtaining credit that is not widely used; it is more common to obtain business credit through an open account with a line of credit.

Property Management

Property management, also called real estate management, is the business of overseeing income-producing properties for third parties in exchange for a fee. A property manager typically has responsibility either directly or indirectly for the following aspects of a building's operations: marketing; financial administration and budgeting; leasing; tenant or resident relations; maintenance; property analysis; and risk management.

Proprietary Information

Proprietary information, also known as a trade secret, is information that a company wishes to keep confidential or secret from those outside the company. Proprietary information may include secret formulas, processes, and methods used in production.

Public Debt

Public debt, sometimes called national debt, is the cumulative amount a national government has borrowed to finance its outlays. Usually a result of deficit spending, public debt is distinct from a budget deficit in that it is cumulative, whereas deficit refers to a particular budget year's shortfall.

Public Offering

In order to raise capital, corporations offer their securities for sale to the general public. An initial public offering (IPO) is the first instance in which a corporation offers a specific, registered security for sale.

Public Relations

The term "public relations" is practically self-explanatory, yet over the years it has meant different things to different people. To some the term conjures up negative images of publicity "hacks," press agents, and propagandists.

Publicly Held Company

A publicly held company exists when that company's stock is owned by members of the general public. The stock of a publicly held company is openly traded.

Purchasing Power

Purchasing power refers to the amount of goods and services a fixed amount of money can purchase. The purchasing power of the dollar is related to changes in prices for different goods and services.

Put-Call Parity

Put-call parity helps to define the relative values of an option to buy a security and the option to sell the same security. For example, suppose Microsoft stock is selling for $93 per share.

Quality Circles

The interest of U.S. manufacturers in quality circles (or quality control circles) was sparked by the dramatic improvements in the quality and economic competitiveness of Japanese goods in the post-World War II years.

Quality Control

Queuing Theory

In its broadest sense, queuing theory is the study of contention for the use of a shared, but limited, resource. It is comprised of models and formulas that describe the relationships between service requests, congestion, and delay.

Random Walk Theory

The random walk theory, in its simplest form, states that stock prices follow no predictable pattern. A controversial proposition, the theory, when taken to its extreme, counters the many forms of security analysis—including fundamental and technical analysis—that purport to positively identify price and risk trends.


A business ranking is one in which different companies or products are listed, or ranked, in order based on specific criteria. Within a particular industry, companies are typically ranked by criteria appropriate to that industry.

Real Estate

Real estate is land and all that is either on or under it, including water, trees, buildings, minerals, and oil. "Real estate," also called "real property," is a term that developed in medieval times.

Real Estate Investment Trusts (REIT)

A real estate investment trust (REIT), is a corporation or trust that combines the capital of many investors to acquire or provide financing for forms of real estate. A corporation or trust that qualifies as a REIT generally does not pay corporate income tax to the Internal Revenue Service; most states, in turn, honor this federal treatment and do not require REITs to pay state income tax either.


Rebates, widely known as refunds, are a popular tool used by businesses to promote their products and services. The term "rebate" derives from the Middle English rebaten, meaning "to deduct." Rebates are distinct from coupons and other forms of discounting in that they reimburse a customer for part of the purchase price after rather than at the time of sale.


A recession is a downturn in the business cycle that occurs when the real gross national product (GNP)—the total output of goods and services produced by the U.S. population—declines for two consecutive quarters, or six months.

Reciprocity (Commercial Policy)

In the area of international trade, reciprocity refers to an agreement between two or more countries to mutually reduce tariffs and duties on goods traded between them. Reciprocity has played an important role in the trade policy of the United States since 1934, when the Reciprocal Trade Agreements Program was initiated to lower tariffs and other trade barriers.

Recycling Programs

Recycling programs comprise three elements in a continuum represented by the "chasing arrows" symbol: collection of recyclable materials from the waste stream, processing the commodities into new products, and purchasing products containing recycled materials. It has been estimated that each office worker in America produces from one-half to one and one-half pounds of solid waste each day, of which 70 to 90 percent is paper.


Refinancing is the refunding or restructuring of debt with new debt, equity, or a combination of both. The refinancing of debt is most often undertaken during a period of declining interest rates in order to lower the average cost of a firm's debt.

Regression Analysis

Regression analysis employs algebraic formulas to estimate the value of a continuous random variable, called a dependent variable, using the value of another, independent, variable. Statistical methods are used to determine the most correct estimate of that dependent variable, and whether the estimate is valid at all.


The concept of reliability or dependability is used in a variety of business and industrial settings. In general, the concept of reliability is applied where it is important to achieve the same results again and again.

Replacement Cost

Under generally accepted accounting principles, the value of a company's assets is based on its historical costs. The present book value of an asset is determined by its acquisition, or historical, cost, less any depreciation.

Repurchase Agreements

Repurchase agreements are considered to be money market financial instruments. Money market financial instruments, in turn, consist of short-maturity or short-term financial instruments.

Request for Proposal

Request for proposal (RFP) is the process by which a corporate department or government agency prepares bid documents to acquire equipment or services. The RFP is frequently published in the legal documents section of pertinent newspapers or in trade journals covering the industry in which the department operates.

Research and Development

Research and development (R&D) represents a large and rapidly growing effort in both industrialized and semi-industrialized nations. In 1997 the United States spent $151 billion on industrial R&D and $32 billion on military R&D, for a total of $183 billion, equal to 2.5 percent of the gross national product (GNP).

Research and Development Consortia

Research and development (R&D) consortia are formed by manufacturing companies, often with the support of government, for the purpose of conducting shared research on new technologies for the benefit of the consortium's member companies. Government-supported R&D consortia (kumaia) have been common in Japan since the 1960s, and now number more than 200.