What is the decision rule for NPV?

Q: What is the difference between ER and REA model

A: ER model stands for Entity Relationship model which is a high-level data model. This model defines…

Q: The NPV of the replacement is $        ?

A: Net present value is the difference of discounted cash inflows and outflows.

Q: What is Scenario Analysis?

A: Scenario analysis is an important step in the financial modelling. This is used to show the possible…

Q: What is Gordon model?

A: Intrinsic value of a stock is based on the internal information of an organization. That is, market…

Q: eristics?

A: Step 1   Risk is defined as an occurrence that harms financial performance and/or reputation as a…

Q: What is the going concern assumption?

A: Going concern Assumption: On the basis of Going concern assumption Financial statements are…

Q: What is IFRS?

A: In accounting and financial reporting there is need of international rules and regulations to create…

Q: What is a call option?

A: The contract that the option writer sells to the option holder is represented by an option, which is…

Q: What is naked call option?

A: An option is a financial derivative giving the buyer of option to buy or sell the option at a price…

Q: What is FIFO?

A: FIFO is a type of inventory management system where stock purchased earlier will be sold first and…

Q: Are these good advantages and disadvantages about RRSP’s? What can I include and remove?

A: RRSP or registered retirement savings plan is a retirement savings plan for employees and self…

Q: What is feasible set?

A: When investors manage their ‘financial assets’, like ‘bonds’, ‘shares’ and other financial…

Q: Explain NAREIT Index?

A: NAREIT Index Rate: It implies the compound dividend yield which is communicated as far as a yearly…

Q: What is indifference curve?

A: Indifference curve: It is a diagram indicating a mix of two items that give equivalent fulfillment…

Q: Why is the NPV preferred over the IRR?

A: Net Present Value is a method of finding the profitability of a project by discounting future cash…

Q: How does the change in the PBO occur?

A: Projected Benefit Obligation:   It is a pension concept in accounting as it is the present value of…

Q: What are the Replacement decisions?

A: Cost:   It is the economic value of resources incurred by a firm to manufacture a product or render…

Q: What is the efficient frontier?

A: The term efficient frontier is used in relation to professor Harry Markowitz's Modern Portfolio…

Q: What is MM Proposition I?

A: Modigliani and Miller’s approach is an element of economic theory and it forms the basis for modern…

Q: What is the FMS option?

A: FMS: Flexible manufacturing system

Q: What assumptions are inherent in the EOQ model as presentedhere?

A: Economic order quantity (EOQ): Economic ordering quantity (EOQ) is the perfect order quantity a…

Q: What is the value of Po?

A: Annuity is referred to a cash payment being made at regular intervals. It is a widely used concept…

Q: What is PNL?

A: The term PNL is used in accounting, finance, and business to refer profit and loss.

Q: What are ESOPs? What are some of their advantages anddisadvantages?

A: ESOP: Employee stock ownership plan is retirement plans for employees of the company wherein the…

Q: What is GAAP and why it is needed?

A: GAAP - Generally Accepted Accounting Principles

Q: What is GAAP?

A: Generally Accepted Accounting Principles (GAAP): These are the guidelines necessary to create…

Q: What is the LIFO conformity rule?

A: Last-in-First-Out (LIFO): In this method, items purchased recently are sold first. So, the value of…

Q: Can you explain DCF model?

A: Introduction Discounted cash flows: DCF is abbreviated as discounted cash flows. The concept of…

Q: What is Hamada equation?

A: The Hamada Equation : The Hamada equation is a method used to analyse the cost of capital of firm.…

Q: what is single index model?

A: Single index model refers to the asset pricing model that can be used to measure the risk and return…

Q: Describe EOQ decision model.

A: Economic order quantity (EOOJ: Economic order quantity is ideal order quantity that the company…

Q: What is the project's NPV

A: The NPV is one of the technique in the capital budgeting which is used in the project evaluation.…

Q: illustrate with an example how can we determine the IRR?

A: IRR is a method that tells the company how much returns the company will earn on the amount spent on…

Q: What is MM Proposition II?

A: MM Model determines and defines a relationship between the capital structure of the firms, the cost…

Q: straight line method?

A: Depreciation = (Historical cost - Salvage Value)/Useful life  Book Value of Asset = Historical cost…

Q: What is the decision rule for ARR?

A: Accounting rate of return refers to rate of profit earned on an investment. The ARR is computed by…

Q: What is the replacement analysis?

A: Replacement analysis is one of the keys examinations in capital budgeting.

Q: Explain what is meant by the decision pattern ?

A: Decisions patterns is how decisions are made what is psychology behind the decision making.

Q: Why is Scenario Analysis useful?

A: Scenario Analysis is a process where various (more than one) input changes are made at the same time…

Q: What is OLTP and OLAP? How are they different?

A: OLAP stands for Online Analytical Processing which helps in analyzing different business elements…

Q: How is breakeven analysis different from CVP analysis?

A: Breakeven analysis: It helps to analyze the break-even level of company that is, the level of…

Q: What is CAPM? What is ‘Alpha’ and ‘Beta’ in CAPM?

A: CAPM - CAPM model means the Capital asset pricing model. It describes the relational ship between…