Severance

Definition:

A settlement received after being released from a corporation. In the context of corporate governance, an agreement that assures high-level executives of their postions or some compensation and are not contingent upon a change in control.

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Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University

Term of the Day

Measurement error

Errors in measuring an explanatory variable in a regression, which leads to biases in estimated parameters.

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