Pay Up

1. situation when an investor who wants to buy a stock at a particular price hesitates and the stock begins to rise. Instead of letting the stock go, he "pays up" to buy the shares at the higher prevailing price.

2. when an investor buys shares in a high quality company at what is felt to be a high price. Such an investor will say "I realize that I am paying up for this stock, but it is worth it because it is such a fine company."

Extent to which credit orders received in response to a promotion are paid at the point that billing of past-due accounts is stopped and unpaid accounts are written off. The pay-up percent is a good relative measure of the profitability of a promotion or product. For example, assume that product A sells for $10 and has a pay-up percent of 60% and that product B sells for $7 and has a pay-up percent of 90%. If 100 units of each are sold, Product A will generate $600 in revenue, and Product B, $630 in revenue. The pay-up speed is also important because of the time value of money-that is, $600 received today is worth more than $600 received a year from today.