Sunday, April 27

Why Interest Rates Are Procyclical.

Using the supply and demand for bonds framework, show why interest rates are procyclical (rising when the company is expanding and falling during recessions).

Source: Google Images

Thursday, April 17

Dormitories. Yay Or Nay?

Should first-year students be required to live in the dormitories?

Dormitories are living facilities designed to accommodate students during their studying years at their respected school, college or university. However, not all students are keen to stay in the provided housing due to the many rules and regulations that they should abide during their stay there. In my opinion, first-year university students should be required to live in dormitories in order for them to get used to the new environment and to learn to stand on their own feet.

Source: Google Images

Wednesday, April 9

Financial Management In Business Perspective.

A prominent feature of large corporations is that the owners (the stakeholders) are usually not directly involved in making business decisions, particularly on a day-to-day basis. Instead, the corporation employs managers to symbolize the owners’ interests and make decisions on their behalf. The financial manager, in a large corporation, must be concerned with the solutions of the three major decisions a firm must make - the investment decision, the financing decision and the working capital management decision.

Source: Google Images
The first decision concerns the firm’s long-term investments. The process of planning and managing the firm’s long-term investments is called capital budgeting. In capital budgeting, the financial manager will try to indentify investment opportunities that are worth more to the firm than their cost to acquire. Loosely speaking, this means that the value of the cash flow generated by an asset should exceed the cost of the asset acquired by the firm.