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Original Cost: Definition, How It Works, and Example Calculation What is original cost? Original cost (also called historical cost or cost basis) is the total price paid to acquire an asset and put it into service. It includes the purchase price plus all directly attributable acquisition and preparation costs required to make the asset operational….

Organized Labor What is organized labor? Organized labor refers to workers banding together—typically through unions—to engage in collective bargaining with employers for higher wages, better benefits, safer working conditions, and greater job security. Unions negotiate on behalf of members and can also lobby for broader labor-law reforms. How organized labor works Workers indicate support for…

What Is an Organizational Structure? An organizational structure is the system that defines how tasks are assigned, who reports to whom, and how information flows within a company. It shapes decision-making authority, clarifies roles and responsibilities, and helps align daily activities with the organization’s goals. Key Takeaways * An organizational structure maps roles, responsibilities, and…

Organizational Economics Organizational economics is a branch of applied economics that studies the transactions and decision-making processes inside firms, rather than in the broader market. It examines how incentives, institutional features, and transaction costs shape organization design, behavior, and performance. The field draws on several theoretical traditions—agency theory, transaction cost economics, and property rights theory—and…

What Is an Organizational Chart? An organizational chart (org chart) is a visual representation of an organization’s structure that shows roles, reporting relationships, and how teams or departments connect. It helps employees and leaders see who is responsible for what, where authority lies, and how information flows. Key Benefits Clarifies reporting lines and authority. Reveals…

Organizational Behavior (OB): What It Is and Why It Matters Key takeaways * Organizational behavior (OB) studies how people act and interact within organizations to improve performance, satisfaction, and innovation. * OB draws on psychology, sociology, anthropology, and management science and uses surveys, observation, case studies, and experiments. * Practical OB informs HR activities (recruitment,…

Organization of the Petroleum Exporting Countries (OPEC) What is OPEC? OPEC is an intergovernmental organization of major oil-exporting countries that coordinates petroleum policies to stabilize oil markets, secure a regular supply to consumers, and support a steady income for producers. Headquartered in Vienna, its permanent secretariat manages day-to-day work and implements decisions taken by member…

Organization of Arab Petroleum Exporting Countries (OAPEC) Overview The Organization of Arab Petroleum Exporting Countries (OAPEC) is an intergovernmental organization based in Kuwait that promotes cooperation among Arab oil-exporting nations. It focuses on joint ventures, coordinated use of petroleum resources, and economic integration among member states. OAPEC is distinct from OPEC (Organization of the Petroleum…

Organisation for Economic Co-operation and Development (OECD) The Organisation for Economic Co-operation and Development (OECD) is an international forum where member countries discuss and develop economic and social policy. Its stated aim is to shape policies that foster prosperity, equality, opportunity and well‑being. Key points Membership (as presented here): 37 countries, typically democratic and market-oriented…

Organisation of Eastern Caribbean States (OECS) Overview The Organisation of Eastern Caribbean States (OECS) is an intergovernmental regional organization that fosters economic integration, trade cooperation, and shared policy across member states in the Eastern Caribbean. It functions as an economic union and single market, promoting free movement of goods, services, people, and capital among its…

Organic Sales Definition Organic sales are revenues generated from a company’s existing operations—sales that result directly from the company’s own products, services, and internal activities. Organic sales exclude revenue increases that arise from acquisitions of other companies or business units and exclude sales from business lines that have been sold or divested. Why it matters…

Reserve-Replacement Ratio: What it Means, How it Works What is the reserve-replacement ratio (RRR)? The reserve-replacement ratio measures how much proved oil and gas a company adds to its reserves during a period (typically a year) divided by the amount it produces in that same period. It is a common metric investors use to assess…

Organic Growth: What It Is and Why It Matters to Investors Organic growth is the expansion a company achieves from its own operations—by increasing sales, improving production, launching new products, or expanding services—rather than through mergers, acquisitions, or other external transactions. For investors, organic growth is a key indicator of a company’s underlying health, competitiveness,…

Ordinary Shares of Stock Key takeaways Ordinary (common) shares represent fractional ownership in a company and typically carry voting rights. Dividends for ordinary shareholders are not guaranteed and are paid only after any preferred-share claims. Ordinary shareholders are last in line in liquidation, after creditors and preferred shareholders. Ordinary shares can offer higher upside in…

Ordinary Loss An ordinary loss is a loss realized in the normal course of business or from non-capital transactions when expenses exceed revenues. It is distinct from a capital loss and, generally, is fully deductible against ordinary income in the year it is incurred. Key points Ordinary losses arise from business operations or non-capital transactions…

What is ordinary income? Ordinary income is any income taxed at the regular (marginal) income tax rates. It includes wages, salaries, tips, bonuses, commissions, rents, royalties, interest, unqualified dividends, and short-term capital gains. For individuals, ordinary income is typically pretax earnings and most forms of unearned income taxed at ordinary rates. For businesses, ordinary income…

Ordinary Dividends — What They Are and How They’re Taxed Definition Ordinary dividends (also called nonqualified dividends) are regular payments corporations make to shareholders from company profits. They are the default classification for dividend payments unless the dividend meets specific IRS criteria to be treated as a qualified dividend. Key takeaways Ordinary dividends are taxed…

Ordinary Annuity — Definition and Key Points An ordinary annuity is a series of equal payments made at the end of each period for a fixed number of periods. Periods can be monthly, quarterly, semiannually, or annually. Common examples include bond coupon payments, many dividend schedules, and loan or mortgage payments when they are due…

Ordinary and Necessary Expenses (O&NE) Ordinary and necessary expenses are business costs that are common, accepted, and appropriate for carrying on a trade or business. For U.S. federal income tax purposes these expenses are generally deductible in the year they are incurred under 26 U.S.C. §162(a), provided they meet the tests of being both “ordinary”…

Orderly Market What is an orderly market? An orderly market is one in which supply and demand are reasonably balanced and transactions occur in a fair, transparent, secure, and efficient manner. In this state of equilibrium, prices tend to reflect the true value of goods, services, or financial securities, supporting steady trading and economic activity….

Order Protection Rule The Order Protection Rule (Rule 611) is a provision of Regulation National Market System (Reg NMS) designed to protect displayed quotations across U.S. trading venues. Often called the “trade-through” rule, it requires trading centers to prevent executions at prices that are inferior to protected quotations shown on other venues, helping ensure investors…

Order Paper: What It Is and How It Works Key takeaways * An order paper (order instrument) is a negotiable instrument payable to a specifically named person or that person’s assignee. * It contrasts with a bearer instrument, which names no payee and can be cashed or transferred by anyone in possession. * Common examples…

Order Management Systems (OMS) What is an OMS? An Order Management System (OMS) is software that facilitates and manages the lifecycle of orders—either financial trade orders in capital markets or customer orders in business and e-commerce. In finance, an OMS handles placement, routing, execution and reporting of buy and sell orders for securities. In business,…

Order Imbalance: Definition, Causes, and Trading Strategies What is an order imbalance? An order imbalance occurs when buy or sell orders for a particular security significantly exceed opposing orders, preventing trades from being matched at prevailing prices. Market makers or specialists may supply shares from a reserve to restore liquidity, or exchanges may temporarily halt…

Order-Driven Market What it is An order-driven market is a trading environment in which buyers and sellers publicly display the prices and quantities at which they are willing to trade a security. These orders populate an order book that a matching engine uses to execute trades. This contrasts with quote-driven markets, where designated market makers…

Order Book An order book is a real-time list of buy and sell orders for an asset (stocks, bonds, currencies, or cryptocurrencies). It shows the price levels, quantities available at each level (market depth), and—when visible—the market participants behind those orders. Order books increase market transparency and help traders assess supply and demand. Key takeaways…

Order Audit Trail System (OATS) What an audit trail is An audit trail is a step-by-step record that links financial data or market activity back to its origin. In finance, audit trails are used to verify accounting figures, reconstruct trades, trace sources of funds, and detect fraud. An Order Audit Trail System (OATS) is one…

Order: Definition, Types, Duration, and How Orders Are Processed An order is an instruction you give a broker to buy or sell a security under specific conditions. Orders define what to trade, how much, at what price, and how long the instruction remains active. Choosing the right order type helps control execution price, limit losses,…

Orange Book: What it is and how it works Definition and purpose The Orange Book is the U.S. Food and Drug Administration’s (FDA) publicly accessible list of drug products approved as safe and effective. Its formal title is Approved Drug Products with Therapeutic Equivalence Evaluations. The list helps identify approved brand-name drugs, their active ingredients,…

Oral Contract: What It Is and How It Works An oral contract is a spoken agreement between parties that, despite lacking written documentation, can be legally binding. Enforceability depends on the jurisdiction, the type of contract, and the available evidence proving the agreement and its terms. Key Points Oral contracts can be legally binding when…

Oracle of Omaha: How Warren Buffett Built His Fortune Warren Buffett, nicknamed the “Oracle of Omaha,” is one of the world’s most successful and influential investors. As chairman and CEO of Berkshire Hathaway, he built a multibillion-dollar fortune through disciplined value investing, long-term holdings, and acquisition of businesses with durable competitive advantages. Key takeaways Buffett…

Options Price Reporting Authority (OPRA) The Options Price Reporting Authority (OPRA) is a consortium of participating U.S. securities exchanges that consolidates and disseminates last-sale and quote information for listed options. Operating as a national market system plan, OPRA collects trade and quote data from member exchanges, standardizes it, and distributes it to brokers, trading firms,…

Understanding Options on Futures Key takeaways * Options on futures grant the right, but not the obligation, to buy (call) or sell (put) a specific futures contract at a preset strike price on or before expiration. * Many futures options are European-style and cash-settled, meaning they can only be exercised at maturity and settle in…

Options Industry Council (OIC): What it is and how it works Key takeaways * The Options Industry Council (OIC) is an educational nonprofit formed by U.S. options exchanges and the Options Clearing Corporation (OCC) to promote understanding of exchange‑traded equity options. * Founded in 1992, the OIC provides free, vetted educational resources for investors, financial…

Options Contracts An options contract is a financial agreement that gives the buyer the right, but not the obligation, to buy or sell an underlying asset at a specified price (the strike) on or before a set expiration date. Options are used for hedging, income generation, and speculation. They offer leverage and flexibility but carry…