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Psychographic data: Information that categorizes customers based on their personalities,
psychological traits, lifestyles, values, and social memberships.
Purchase method: After the acquisition, the target firm‟s assets are put on the bidder‟s balance sheet
at their fair market value; often creates the intangible asset goodwill.
PVA N : Present value of an annuity.
Quick ratio: (Current Assets - Inventories)/Current Liabilities. Also known as the acid test ratio.
Rate of return: An amount of income (loss) and/or change in value realized or anticipated on an
investment, expressed as a percentage of that investment.
Regulation D: Under the Securities Act of 1933, all offers to sell securities must either be registered
with the SEC or meet an exemption. Regulation D contains three rules (Rules 504, 505, and 506)
offering exemptions from registration requirements, allowing smaller companies to offer and sell
securities without having to register the securities with the SEC.
Repatriation risk: The risk that governments will not allow money to flow out of a country.
Request for proposal (RFP): A request made by a company to a vendor or supplier to submit a
proposal for a specific product or service.
Required return: The return required by a corporation to invest in a project. It is weighted average
cost of capital (WACC), adjusted for risk.
Residual value: The prospective value as of the end of the discrete projection period in a discounted
benefit streams model.
Restatements: Corrected financial statements, usually to replace financial statements that have been
materially misstated—or more rarely to allow for mergers or other legitimate factors (as opposed to
error or fraud).
Restructuring charges: Expenses typically recognized in conjunction with downsizings,
reengineerings, reorganizations, and comparable activities. The expenses are usually made up of cash
costs, accruals of obligations for future expenditures, as well as the write-down of assets.
Risk premium: A rate of return in addition to a risk-free rate to compensate the investor for accepting
risk.
Risk-free rate: The rate of return available in the market on an investment free of default risk.
Secondary target audience (STA): A group of potential customers identified by demographic and
psychographic data that will be a secondary or alternative focus of the company‟s early marketing and
sales efforts. See also Primary target audience.