What is the difference between JOURNAL ENTRY & LEDGER?

Correct Answer: Regular dividend payments are signals that a company is healthy and profitable Also, issuing dividends can attract investors (shareholders) Finally, a company may distribute earnings to shareholders if it lacks profitable investment opportunities

Correct Answer: Undergraduates may get this question as feelers of their business knowledge Insider trading describes the illegal activity of buying or selling stock based on information that is not public information This is to prevent those with privileged information (company execs, I-bankers and lawyers) from using this information to make a tremendous amount of money unfairly

Correct Answer: The term derivative indicates that it has no independent value that is its value is entirely derived from the values of the underlying assets The underlying asset can be securities, commodities , bullion, currency, livestock or anything else

Correct Answer: Demat means Dematerialisation of share, in simple it is an account with which a person can trade in security market without which a person cannot buy or sell any share in security market

Correct Answer: A segment of the financial market in which financial instruments with high liquidity and very short maturities are traded The money market is used by participants as a means for borrowing and lending in the short term, from several days to just under a year Money market securities consist of negotiable certificates of deposit (CDs), bankers acceptances, US Treasury bills, commercial paper, municipal notes, federal funds and repurchase agreements (repos)

Correct Answer: Nominal money relates more to it's measure of counting - so nominal figure of what is written on bill, while "real" relates more to it's purchasing power (usually between some periods of time) For instance 100 units in nominal could buy 2 units of good in 1950 and 1 unit of good in 2005, at the same time real value of this 100 nominal units are 100 real units in 1950 and 50 real units in 2005 Same is with GDP In nominal it can rise due to inflation while it can stay the same or even decrease in real value

Correct Answer: In economic terms, inflation is the rise in the prices of goods and services in the given economy over a period of time As the prices rise, each unit of the country's currency will buy fewer goods and services when the purchasing power of a currency go down then more money comes to the market it is called inflation

Correct Answer: The main difference lies in the motive of the two parties The main motive of the hedger is to hedge(minimize) the risk from the occurence of some events The motive of the speculator is to gamble in the market in order to make the profit by buying/selling the derivative products

Correct Answer: In business, a takeover is the purchase of one company by another

Correct Answer: Investment and asset are really close in meaning Investment is when you put your money in stock, bond or other financial instruments Whereas Asset is what you own generally reffered to land, proprietorship , factory, etc