What Is Inflaition?

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: A journal is also called as a book of prime entryTransactions occurred are first entered in this book to show which accounts should be debited and which should be credited on the basis of entries made in the journal, accounts are prepared, the book which contains the accounts is called a ledger Transactions entered in the journal are classified according to their nature and posted in their respective accounts in ledger it is also called as book of final entry

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: 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

Correct Answer: Rupess is the currency of our country and only govt has the authority to issue indian currency it has been signed by ministry of finance, all other notes are bearer notes which are signed by governor no interference by RBI RBI has the right to print currency notes in the country except coins & 1 Re note which are issued by Govt Thus, it bears the sign of MoF

Correct Answer: It is statement of balances of all the accounts in the ledger prepared to prove the arithmetical accuracy of the books of accounts A trial Balance is a list of Debit and Credit or a list of Debit & Credit Balance of all the ledger accounts prepared on any particular date