Dictionary of Accounting Terms for: utility
  1. economic and highly subjective term describing satisfaction of a specified want. Utility and usefulness are not necessarily synonymous terms. Artwork may be functionally useless but yet provide great utility to an art lover.
  2. value of a certain outcome or payoff to someone; the pleasure or displeasure that person would derive from that outcome.
Dictionary of Business Terms for: utility
  1. service, such as water, sewerage, gas, electricity, and telephones, that is generally required to operate a building.
  2. computer program that provides a specific function to assist in the operation of the computer, such as checking for viruses, defragmenting the hard disk, or compressing data. Contrast with application software.
Dictionary of Computer and Internet Terms for: utility

a program that assists in the operation of a computer but does not do the main work for which the computer was bought. For instance, programs that compress data or defragment disks are utilities (see data compression; fragmentation; Norton Utilities). By contrast, word processors, financial programs, engineering programs, and other programs that do actual work for the user are called application programs.

Dictionary of Finance and Investment Terms for: utility

power company that owns or operates facilities used for the generation, transmission, or distribution of electric energy. Utilities provide electric, gas, and water to their customers. In the United States, utilities are regulated at the state and federal level. State public service and public utility commissions regulate retail rates. The Federal Energy Regulatory Commission (FERC) regulates wholesale rates, the sale, resale, and interstate commerce for approximately 200 investor-owned utilities. On a percentage and revenue basis, however, the states regulate most of the trade. Rates for the sale of power and its transmission to retail customers, as well as approval for the construction of new plants, are regulated at the state level. The electric utility industry came under government regulation in the 1920s because it was a virtual monopoly, vertically integrated, producing energy and transmitting it to customers. The industry has evolved to include public power agencies and electricity cooperatives. deregulation of the natural gas industry in recent years has served to open that market to more competition, although transmission pipelines still come under FERC jurisdiction. The electric utility industry is also undertaking a similar deregulation process.

Utility stocks usually offer above-average dividend yields to investors, but less capital appreciation potential than growth stocks. Utility stocks are also very sensitive to the direction of interest rates. Rising interest rates tend to harm the value of utility shares because higher rates provide a more attractive alternative to investors. In addition, utilities tend to be heavy borrowers, so higher interest rates add to their borrowing costs. Conversely, falling interest rates tend to buoy the value of utility stocks because utility dividends look more attractive and because the companies’ borrowing costs will be reduced.

Dictionary of Insurance Terms for: utility

quality of being useful. Risk diminishes maximum utility in society because resources gravitate to activities, businesses, and investments that are least risky. By absorbing or protecting against some risks, insurance increases utility. When individuals know they will have some cushion against loss, their assets can be spread out over a greater range of activities and enterprises.

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