What is Japan Credit Rating Agency ?

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The Japan Credit Rating Agency (JCR) is a Japanese financial services company that provides credit ratings on the corporate debt of Japanese companies and foreign bond issuers. The entity also publishes a variety of financial and economic information and serves as a guide for counterparty credit risk.

Definition

The Japan Credit Rating Agency (JCR) is a Japanese financial services company that provides credit ratings for corporate debt of Japanese companies and foreign bond issuers. JCR also publishes various financial and economic information and serves as a guide for counterparty credit risk.

Origin

JCR was established in 1985 to provide independent credit rating services for the Japanese market. As global financial markets evolved, JCR expanded its services to include international bond markets.

Categories and Features

JCR's rating services are primarily divided into corporate debt ratings and sovereign debt ratings. Corporate debt ratings assess the credit risk of companies, while sovereign debt ratings evaluate the credit risk of countries or regions. JCR's rating standards are stringent, focusing on financial stability and market conditions.

Case Studies

A typical case is JCR's rating of Toyota Motor Corporation's debt. JCR assigned a high rating to Toyota, reflecting its strong market position and financial health. Another case involves JCR's rating of a developing country's sovereign debt, highlighting the impact of economic policy uncertainty on its credit risk.

Common Issues

Investors often misunderstand the stability of credit ratings, assuming they do not change. However, ratings are adjusted based on changes in market conditions and company financials. Another common issue is over-reliance on ratings while neglecting other financial indicators.

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Zero-Rated Goods

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Zero-Floor Limit

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Zero-Floor Limit

The term "zero-floor limit" refers to a policy whereby merchants are required to obtain authorization for every transaction processed at their store, regardless of its size. By contrast, some stores only require authorization for transactions that are above a certain size, with that size threshold being known as the store's floor limit.

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Lisbon Treaty

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Labor Intensive

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Labor Intensive

The term "labor-intensive" refers to a process or industry that requires a large amount of labor to produce its goods or services. The degree of labor intensity is typically measured in proportion to the amount of capital required to produce the goods or services: the higher the proportion of labor costs required, the more labor-intensive the business.

Fast-Moving Consumer Goods

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Fast-moving consumer goods (FMCGs) are products that sell quickly at relatively low cost. FMCGs have a short shelf life because of high consumer demand (e.g., soft drinks and confections) or because they are perishable (e.g., meat, dairy products, and baked goods).They are bought often, consumed rapidly, priced low, and sold in large quantities. They also have a high turnover on store shelves. The largest FMCG companies by revenue are among the best known, such as Nestle SA. (NSRGY) ($99.32 billion in 2023 earnings) and PepsiCo Inc. (PEP) ($91.47 billion). From the 1980s up to the early 2010s, the FMCG sector was a paradigm of stable and impressive growth; annual revenue was consistently around 9% in the first decade of this century, with returns on invested capital (ROIC) at 22%.

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Negotiable Instruments

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