Introduction There was a period of extreme economic suffering in the fall of 2008, which was characterized by a general downturn in housing prices, an increase in default rates and seizures, and a sharp decline in the value of home loan securities and other associated instruments. IndyMac Bank and Lehman Brothers, two significant institutions, suffered … Read more
Balance of Payments (BoP) The Balance of Payments (BoP), commonly referred to as the balance of international payments, is a list of all economic transactions that take place between entities in one nation and the rest of the world within a specific time period. In other words, Balance of Payment is a balance sheet of … Read more
Introduction Financial planning is a process that helps people and organizations to identify their financial goals and then develop strategies for meeting those goals. It is a process that helps you to understand your current financial situation and plan for the future. A comprehensive financial plan includes both protection (life insurance) and investment (stocks, bonds). … Read more
Introduction to Systematic Investment Plan (SIP) Systematic Investment Plan (SIP) is an investment method in which one can invest a specified amount in a financial scheme (mutual funds for instance) at regular intervals in a systematic and scientific way. The funds are invested once a month or once a quarter, rather on a lump-sum basis. … Read more
Introduction Financial statements are a set of documents that provides information about the financial position, operating performance and cash flows of a company or other organization. They are usually prepared annually and are divided into three main categories: Financial statements provide a snapshot of the financial health of a company. They are an excellent way … Read more
Introduction World is globalizing and changing. Exponential growth in technology and integration of technology in market operation have transformed the way markets behave. Such integration has also changed the way the financial market operates and the way market participants interact. Financial operations have seen a dynamic shift. Now, we have as amazing technology as blockchain … Read more
ACCOUNTING EQUATIONS Assets Capital + Liabilities Assets Capital Introduced + (Income -Expenses ) -Drawings + Liabilities Shareholders’ Equity Capital Stock + Retained Earnings NET INCOME EQUATIONS Net Income Revenue – Expenses Net Income Income from Operations + Interest Income -Income Taxes BREAK EVEN POINT Break Even Point Sales-Fixed Costs-Variable Costs CASH RATIO EQUATION Cash Ratio … Read more
Introduction CRR stands for Cash Reserve Ratio. The CRR is a measure of a bank’s liquidity. It is the percentage of its total deposits that the bank sets aside in cash or as cash equivalent. Cash Reserve Ratio is calculated by dividing a bank’s cash and near cash holding by its total deposits. CRR =(Cash … Read more
Introduction to Market Liquidity Market liquidity is the degree to which an asset can be bought or sold in the market without affecting its price. It is a measure of how easily an item can be traded for another item, or into the common currency within an economy. Liquidity is mainly determined by the size … Read more
Sources of Internal Finance Funds created by the company itself, within the company, is internal finance. There are various sources for internal funding. Some companies use them to fund their business and others use them for investment. There are various sources from which a company can raise funds internally. The sources of finance internal to … Read more