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What are the negative consequences of a company holding too much cash?
A company holding in excess of cash would be giving up the opportunity to invest more in income producing assets
The price-yield relationship of a non-callable or a non-putable bond is convex because price and yield are inversely proportional. Figure 1 shows the price-yield
Q. What do you mean by synergy? Synergy: synergy refers to the greater combined value of merged firms than the sum of the values of individual units. It is something like one p
We have seen earlier that there are callable bonds. This is a valuable feature for the issuers who consider that their stock is undervalued enough so that selling
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Partition of Investment Risk The expected returns and the fluctuation in returns are two factors in evaluating investments. Expected Returns While the actual returns
Q. Traditional Approach of Financial Management? Traditional Approach: - Under this schema the role of financial management was limited to the procurement of funds on suitable
Have the large bank holding companies increased their market share at the expense of smaller institutions? A: No. A study conducted by the Federal Reserve Bank of New York reve
Q. Evaluate Certainty Equivalent Coefficient? Illustration: - Presume the risky cash flow is Rs. 200000 and the riskless cash flow is Rs. 140000. The Certainty Equivalent Co
What is the difference between the Euronote market, the Euro-medium-term-note market, and the Eurocommercial paper market? Answer: Euronotes are short-term notes guarantees by
In indexed bonds, the principal and coupon payments are linked to the market index like inflation and price index. Index bonds are attractive to investors
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