A machine has a initial cost of Php 20,0 00. It will also require a Php 6,000 for its installation fee. This machine is expecte d to bring a annual saving of Php 5,000 during its economic life of 10 years. Usi ng standard Declining Balance Method at 7% annual rate, find: a) the total cach inflou

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: How is ARR calculated?

A: ARR: Accounting Rate of Return (ARR) is the rate of return earned on the investment made in a…

Q: What is Gordon model?

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

Q: Sensitivity Analysis Methods

A: Sensitivity analysis is an analysis method that is used to identify how many variations in the input…

Q: Examples of  CIRO and PIRO

A: Example of CIRO: A note book valued at $5 CAD is being transported through courier would be exempt…

Q: Define Depletion.

A:

Q: Explain compound interest.

A: Compound interest.

Q: Wat is investment

A: According to the standards, investment can be classified into three categories, i.e. held to…

Q: Define the term PW criterion?

A: Present worth is a systematic identicalness technique where cash flows of a task are limited at…

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 factoring?

A: Accounts receivable: It can be defined as the amount owed by the customers from the business for the…

Q: Define Factoring.

A: Accounts Receivable: It refers to the amount of money due to the company from the debtors.

Q: What is Miller model?

A: It represents the impact of individual taxes or personal taxes into the valuation of a levered firm,…

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: Consider REMICs?

A: A real estate mortgage investment conduit (REMIC) is a difficult puddle of mortgage securities…

Q: Describe the revaluation model.

A: Introduction: The revaluation model stretches a business the option of carrying a fixed asset at its…

Q: What is the difference between I and G spread measures?

A: The yield spread of the bond reflects the difference between the YTM(Yield to Maturity) of various…

Q: Define white knight

A: A white knight is hostile acquisition security by which a 'friendliness' person or business who…

Q: What is the meaning of incoterms

A: International chamber of commerce is the supervisor of international trading, and try to provide…

Q: How to calculate r value

A: The interest rate: The rate that is used to compute the simple or compound interest is known as the…

Q: What is the DCF method?

A: DCF is a complex tool for valuation which approximates the value of any investment depending upon…

Q: What is RAROC?

A: RAROC stands for Risk-Adjusted Return on Capital. It is a financial metric used by banks and other…

Q: What is the Baumol model, and how is it used?

A: The Baumol model, also known as the Baumol-Allais-Tobin (BAT) model, is a cash management model. In…

Q: I need exact interest

A: Solution:Exact interest method is based on 365 days in a year.As per exact interest method,Interest…

Q: What is a cfar?

A: Cash Flow at Risk (CFAR):Cash Flow at Risk is a term which focuses on the risk of receivables and…

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: where is the evaluate?

A: There are different type of the evidences that needs to be obtained in order to provide the evidence…

Q: What is the difference between the CML and the SML?

A: The term CML refers to capital market line. Whereas the term SML refers to security market line.

Loanable Funds Theory

The loanable funds theory is a neoclassical theory that determines the interest rate where the demand for loanable investments and supply of loanable funds intersect. To determine the interest rate, this theory employs linear regression and a demand curve. At the equilibrium point, demand for borrowings and demand for the issuance of borrowing funds are inextricably linked. This point of equilibrium should equalize demand and the supply of money available for borrowing.