Constant dollar plan
Constant dollar planMethod of purchasing securities by investing a fixed amount of money at set intervals. The investor buys more shares when the price is low and fewer shares when the price is high, thus reducing the overall cost.
Constant dollar planA plan which enables investors to accumulate shares in a mutual fund by purchasing them on a regular basis (for example monthly) with a fixed dollar amount. The dollar amount buys more shares when the price is low than when it is high, and over time the investor will have accumulated shares at a cost which is neither high nor low, but average for the period in question. Hence the other name for this process - 'dollar cost averaging'. In the UK, the same principles apply to savings plans for unit trusts, and the process is called 'pound cost averaging'.
Constant yield methodConstant yield method
Allocation of annual interest on a zero-coupon security for income tax use.
Constant pricesConstant prices
See constant dollars.
Constant dollarsConstant dollars
Dollars of a base year used as a general measure of purchasing power.
Constant returns to scaleConstant returns to scale
A property of a production function such that scaling all inputs by any positive constant also scales output by the same constant. Such a function is also called homogeneous of degree one or linearly homogeneous. CRTS is a critical assumption of the H-O Model of international trade. Contrasts with increasing returns and decreasing returns.
Constant growth modelConstant growth model
Also called the Gordon-Shapiro model, an application of the dividend discount model that assumes (1) a fixed growth rate for future dividends, and (2) a single discount rate.
Further SuggestionsConstant elasticity of substitution function
Constant ratio plan