Economy and Business Terms - Charlie, your teacher of English
the month and $20,000 at the end of the month. It is important to distinguish cash flow, which is the
change in the balance, from cash or cash balance, which is the resulting ending balance. More
formally, cash flow is an assessment and understanding of cash coming into and flowing out of the
venture in specific periods of time. This can be based on projections or actual cash flow.
Chapter 11 bankruptcy. Chapter 11 is a chapter of the US bankruptcy code that gives a company
an opportunity to reorganize and emerge from bankruptcy. Chapter 11 bankruptcy is a form of
corporate financial reorganization in which a company's assets gets sold off to pay creditors. In
some cases, Chapter 11 bankruptcy allows companies to continue to function. Creditors must vote
to approve the reorganization plan. If a plan cannot be agreed, the court can either convert the case
to a liquidation under Chapter 7 or, if this is in the interest of creditors, return the business to the
status quo before bankruptcy.
Checking Account: An account at a bank in which a customer deposits money for immediate use.
For example, one may utilize a checking account for one's monthly expenses, such as a mortgage
payment or groceries. Because most customers keep money in a checking account for a shorter
period than in a savings account, a current account pays a slightly lower interest rate. Typically, one
can write a check or use a debt card on a checking account, and banks expect customers to do so.
The term "checking account" is more common in the United States. In the United Kingdom, the
common term is "current account."
Close price: The closing price is the final price at which a security is traded on a given trading day.
The closing price represents the most up-to-date valuation of a security until trading commences
again on the next trading day. Most financial instruments are traded after hours (although with
markedly smaller volume and liquidity levels), so the closing price of a security may not match its
after-hours price.
Collateral: In lending agreements, collateral is a borrower's pledge of specific property to a lender,
to secure repayment of a loan. The collateral serves as protection for a lender against a borrower's
default - that is, any borrower failing to pay the principal and interest under the terms of a loan
obligation. If a borrower does default on a loan (due to insolvency or other event), that borrower
forfeits (gives up) the property pledged as collateral—and the lender then becomes the owner of the
collateral. In a typical mortgage loan transaction, for instance, the real estate being acquired with
the help of the loan serves as collateral. Should the buyer fail to pay the loan under the mortgage
loan agreement, the ownership of the real estate is transferred to the bank. The bank uses a legal
process called foreclosure to obtain real estate from a borrower who defaults on a mortgage loan
obligation.
Collateralize: To offer an asset as a surety that a debt will be repaid. The asset may be kept by the
lender until the debt is repaid, or the borrower may maintain possession with the proviso that the
lender may take possession of the borrower defaults. For example, one collateralizes a mortgage
loan with the real estate one purchases with the loan. If the loan is not repaid, the lender has the
right to seize the real estate in question.
Commercial paper: It's is an unsecured, short-term debt instrument issued by a corporation,
typically for the financing of accounts receivable, inventories and meeting short-term liabilities.
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