Financial Intermediaries – Financial Intermediary Definition A financial intermediary is an entity that acts as the middleman between two parties in a financial transaction. Intermediaries include commercial banks, investment banks, mutual funds, or pension funds. Financial intermediaries provide a middle ground between two parties in any financial transaction. For example, […]
Financial Analysis
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What Is Interest Rate Parity (IRP)? Interest rate parity (IRP) is the fundamental equation that governs the relationship between interest rates and currency exchange rates. Interest rate parity (IRP) plays an essential role in foreign exchange markets. It connects interest rates with spot exchange rates and foreign exchange rates. According […]
Residual Income Formula Residual Income Formula = Controllable Margin – Average of Operating Assets x Required Rate of Return Controllable margin – is also known as segment margin. It refers to the project’s revenue minus expenses. The required rate of return is the minimum amount of return that a company […]
What are Marketable Securities Marketable securities are liquid financial instruments. They can be quickly converted into cash at a reasonable price. The liquidity of marketable securities comes from the fact that the maturities tend to be less than one year. Also, the rates at which they can be bought or sold […]
What Is the Marginal Cost of Production? The marginal cost of production is the change in total production cost that comes from making or producing one additional unit. To calculate marginal cost, divide the change in production costs by the change in quantity. The purpose of analyzing marginal cost is […]
What Is Business Logic Business logic in programming is using custom rules to handle the exchange of information between a database and user interface. Business logic is essentially the part of a computer program that contains the information in the form of business rules. These rules define or constrain how […]