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Explain how the market system allocates scarce resources?
Scarce resources are usually allocated to a given market system based on the demand. In most cases the resources are usually assigned to markets that have a great demand.
What is the role of a secondary market?
The secondary market is where previously issued financial instruments, such as stocks and bonds, are bought and sold among investors. It provides liquidity, allowing investors to easily enter and exit positions, while also helping to determine the market value of securities based on supply and demand. This market plays a crucial role in price discovery and enables companies to raise capital more efficiently by allowing investors to trade shares freely. Overall, the secondary market enhances overall market efficiency and stability.
What is Risk adjusted return on economic capital?
RAROC is a risk based profitability measurement for analyzing the risk-adjusted financial performance of the company and for providing a consistent view of the profitability across businesses. RAROC is usually used in banking parlance where companies have to handle the risk of losses.In business enterprises, risk is traded off against benefits. RAROC is defined as the ratio of risk adjusted return to economic capital. The economic capital is the amount of money which is required to secure the survival of the organization in a worst case scenario; it is a buffer against expected shocks in the market values. Economic capital is a function of credit risk, market risk and operational risk and is often calculated by VaR (Value at Risk). This use of capital based on risk improves the capital allocation across the different functional areas of banks, insurance companies or any other business in which capital is placed at risk for an expected return above the risk-free rate.Formula:RAROC = Expected Return / Economic Capital orRAROC = Expected Return / Value at Risk
What is a market economy based on?
A market economy is an economy in which decisions regarding investment, production and distribution are based on market determined supply and demand. Prices of goods and services are determined in a free priced system
How do you use Capitalism in sentence for kids?
Companies in a market economy make decisions based on supply and demand. An example of a sentence using the term "market economy" is "The opposite of a market economy is a planned economy, wherein decisions are made based on a preconceived plan without regard to supply and demand. "
Explain how the market system allocates scarce resources?
Scarce resources are usually allocated to a given market system based on the demand. In most cases the resources are usually assigned to markets that have a great demand.
How do you envisage the use of principle based reporting for the six types of capital companies have to report on?
Nerd
What services does RedCloud offer?
RedCloud Capital is based in Denver, Colorado. RedCloud is a company which invests in lower, middle-market companies. According to RedCloud's website, the company is currently seeking partners and is in the middle of a rebranding effort.
Is Pacific Capital Companies LLC a reputable company?
Pacific Capital Companies LLC is a business that develops customized financial solutions for businesses. The company is now known as PCC Prime. They are based in California.
Who commissions computer based market research?
Computer based market research is usually commissioned by the computer companies themselves to find out what the consumer wants out of their computer and how to better deliver it.
Is the share of capital stock assigned to market value?
Yes, the share of capital stock is typically assigned based on its market value, which reflects the price investors are willing to pay for it in the stock market. This market value can fluctuate due to various factors, including company performance, investor sentiment, and economic conditions. However, the book value of capital stock, which is based on the company's financial statements, may differ from market value. Investors often use market value to assess a company's worth and make investment decisions.
What are bank based and market based financial systems?
Bank-based financial systems primarily rely on banks and financial intermediaries to facilitate the flow of funds, with banks playing a central role in lending and capital allocation. In contrast, market-based financial systems depend on capital markets, such as stock and bond markets, where securities are traded directly among investors, allowing companies to raise funds through public offerings. Each system has its advantages: bank-based systems may offer stability and credit access, while market-based systems can provide greater liquidity and transparency. The choice between these systems often reflects a country's economic structure and regulatory environment.
What are advantages of capital market?
One of the benefits of a global capital market is the large supply of funds available for people to borrow. Another benefit is the lower rate associated with borrowing compared to a generic capital market.
What are the disadvantages of traditional costing?
Main disadvantage of tradional costing system is that it allocates the overheads based on formula which is not accurate because it allocates the cost to department which even not performed any work. It is also a disadvantage is that, it allocates the cost of idle capacity to units as well instead of charging it to income statement.
Who are the top rating agencies in South Africa for the utility industry?
* EVA Capital (www.evaluengineering.co.za) * Fitch & Moody's * S&P Problem with the Fitch & S&P is that the data they tend to use is calibrated towards international trends whereas EVA's is more based on local South African companies. They have a better local market understanding * EVA Capital (www.evaluengineering.co.za) * Fitch & Moody's * S&P Problem with the Fitch & S&P is that the data they tend to use is calibrated towards international trends whereas EVA's is more based on local South African companies. They have a better local market understanding
What index is used in Singapore stock market?
Straits Times IndexSTI is a market value-weighted stock market index based on the stocks of the top 30 companies listed on the Singapore Exchange.
Why do companies choose to go public through an initial public offering (IPO)?
Companies choose to go public through an initial public offering (IPO) to raise capital for growth and expansion, increase their visibility and credibility in the market, provide liquidity for existing shareholders, and potentially attract top talent through stock-based compensation.
