EXCESS EARNINGS Definition

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EXCESS EARNINGS is that amount of anticipated benefits that exceeds a fair rate of return on the value of a selected asset base (often net tangible assets) used to generate those anticipated benefits.

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PLUM is an investment with a healthy rate of return.

PREREFUNDING is the the issuing of new securities to refund an outstanding security. Proceeds from the new securities are used to buy instruments, usually U.S. Treasuries, to be held in escrow for the purpose of retiring bonds or preferred stock.

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