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Ability To Pay: Refers to the borrower's ability to make interest and principal payments on debts. See: Fixed charge coverage ratio. In context of municipal bonds, refers to the issuer's present and future . . . View Full Definition

Liability Insurance: Insurance against legal liability to pay compensation and court costs where the insured has been found negligent in respect of injuries sustained by another person or damage to his/her property.

Dividend Payout Ratio: You can calculate a dividend payout ratio by dividing the dividend a company pays per share by the company's earnings per share. The normal range is 25% to 50% of earnings, though the averag . . . View Full Definition

Prior-Preferred Stock: Preferred stock that has a higher claim on all dividends and assets in liquidation than claims of other preferred stock.