Business glossary

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Earning Power - The demonstrated ability of a business to earn a profit, over time, while following good accounting practices.

Earnings - A sum of money gained from employment, usually quoted before tax, including extra reward such as fringe benefits, allowances, or incentives. In business, income or profit from a business, quoted gross or net of tax, which may be retained and distributed in part to the shareholders.

Earnings Response Coefficient - The relation of stock returns to earnings surprises around the time of corporate earnings announcements.

Easement - A right or privilege that a person may have on another's land, as the right of a way or ingress or egress. Business glossary.

E-business - The conduct of business on the Internet, including the electronic purchasing and selling of goods and services, servicing customers, and communications with business partners.

E-commerce - The exchange of goods, information products, or services via an electronic medium such as the Internet.

Eclectic Paradigm - A theory of the multinational firm that posits three types of advantages benefiting the multinational corporation: ownership-specific, location-specific, and market internalization advantages.

Emerging Stock Markets - The stock markets of emerging economies. These markets typically have higher expected returns than established markets but also higher risk. Business glossary.

Endogenous Uncertainty - Price or input cost uncertainty that is within the control of the firm, such as when the act of investing reveals information about price or input cost.

Enterprise - A venture characterized by innovation, creativity, dynamism, and risk. An enterprise can consist of one project, or may refer to an entire organization.

Entrepreneur - An innovator of business enterprise who recognizes opportunities to introduce a new product, a new process or an improved organization, and who raises the necessary money, assembles the factors for production and organizes an operation to exploit the opportunity.

Equal opportunities - The granting of equal rights. privileges, and status regardless of gender, age, race, religion, disability, or sexual orientation. Equality in employment is regulated by law in most Western countries.

Equipment - Physical property of a more or less permanent nature ordi­narily useful in carrying on operations, other than land, buildings or improvements to either of them. Examples are machinery, tools, tracks, cars, ships, furniture and furnishings. Business glossary.

Equity - A financial investment in a business. An equity investment car­ries with it a share of ownership of the business, a stake in the profits and a say in how it is managed. Equity is calculated by subtracting the lia­bilities of the business from the assets of the business.

Equity capital - Money furnished by owners of the business.

Equity Financing - The provision of funds for capital or operating expenses in exchange for capital stock, stock purchase warrants and options in the business financed, without any guaranteed return, but with the opportunity to share in the company's profits.

Erosion - Cash-flow amount transferred to a new project from customers and sales of other products of the firm.

Ergonomics - The study of workplace design and the physical and psychological impact it has on workers. Ergonomics is about the fit between people, their work activities, equipment, work systems, and environment to ensure that workplaces are safe, comfortable, efficient, and that productivity is not compromised.  Business glossary.

Escrow Accounts - Funds placed in trust with a third party, by a borrower for a specific purpose and to be delivered to the borrower only upon the fulfillment of certain conditions.

Euro - The currency of 12 member nations of the European Union. The Euro was introduced in 1999, when the first 11 countries to adopt it joined together in an Economic and Monetary Union and fixed their currencies' exchange rate to the Euro. Notes and coins were brought into general circulation in January 2002, although banks and other financial institutions had before that time carried out transactions in Euros. Business glossary.

Exchange - The process by which two or more parties give something of value to one another to satisfy needs and wants.

Exchange controls - The regulations by which a country's banking system controls its residents' or resident companies' dealings in foreign currencies and gold.

Exchange rate - The rate at which one country's currency can be exchanged for that of another.

Excise duty - A tax on goods such as alcohol or tobacco produced and sold within a particular country.

EXIMBANK - Export-Import Bank of the United States. Provides guarantees of working capital loans for U.S. exporters, guarantees the repayment of loans or makes loans to foreign purchasers of U.S. goods and services, and provides credit insurance against non-payment by foreign buyers for political or commercial risk. Currently, the Bank is focusing on critical areas such as emphasizing exports to developing countries, aggressively countering trade subsidies of other governments, stimulating small business transactions, promoting the export of environmentally beneficial goods and services, and expanding project finance capabilities. Ex-Im Bank is not an aid or development agency, but a government held corporation, managed by a Board of Directors. Business glossary.

Expense account - Amount of money that an employee or group of employees can draw on to reclaim personal expenses incurred in carrying out activities for an organization.

Expenses - Personal costs incurred by an employee in carrying out activities for an organization that are reimbursed by the employer.

Export agent - An intermediary who acts on behalf of a company to open up or develop a market in a foreign country. Export agents are often paid a commission on all sales and may have exclusive rights in a particular geographic area.

Exporting - The process of selling goods to other countries. Business glossary.

Expropriation - A specific type of political risk in which a government seizes foreign assets.

External Market - A market for financial securities that are placed outside the borders of the country issuing that currency.

Extraterritoriality - A government practice which applies its laws outside its territorial boundaries.