Efficiency as it relates to capital markets occurs when share prices at all times reflect all available relevant information. From the above, we can deduce that if a market is efficient, any new information available in the market which relates to a security of a particular firm will be incorporated into the share price speedily and rationally.
[Read more…] about Capital Market Efficiency & Efficient Market Hypothesis
Money! Money! Money! How can we stop the urge to spend you? How can we save wisely for the rainy day? You looking so delicious chilling in my wallet, and the demons are singing to me, telling me to eat you up, but I refused, I held my ground, I thought about the rainy day. What if I need money for an emergency, would I go begging?, would I take up a debt? No, I must plan my spending wisely incase I am in need tomorrow. Lol.. sorry for that, I couldn’t just help myself. Let’s go into the business of today. I would be suggesting some methods you can use to control your spending.
[Read more…] about Tips for controlling your spending
Pricing decisions are very important decisions organizations need to make. It can make or mar a business. If prices are too high, there is a tendency that consumers avoid your products and move on to similar products with lower prices. On the other hand, if prices are too low, to the point of not being able to cover your average variable costs or fixed costs, you might need to shut down your business.
[Read more…] about Pricing Decisions
Some few days ago, I decided to promote my website’s fan page on Facebook (If you have not yet liked it, be sure to do so by the right hand side of this post…thanks). Facebook accepted advertisers from Nigeria to pay in their local currency which is Naira. I was so excited when I saw this option, I then went ahead to set up my ad. I uploaded my logo, targeted my audience, and was about to select a payment method. When I got to this section, I quickly went to grab my GTB Naira denominated debit card; inputted the number and the cvv2. After, I pressed the OK button and like a little child was smiling and thinking about how wonderful Facebook is for availing us this option. Deep in thought, I didn’t pay attention to the message on my screen. Then I glanced at it and saw an error message, saying that the card had been declined, I should try another card, and if it persists, I should contact my bank. What? I yelled, are they taking a piss? I was so sad.
[Read more…] about Cbn Forex Policy
This is a very powerful tool in management accounting. Its main purpose is to help management understand the relationship among cost, volume and profit, and management uses the information derived from the analysis to make sound business decisions regarding products to be produced and sold, prices to be charged for the product, cost structure to maintain, marketing strategy to adapt and so much more.
[Read more…] about Cost Volume Profit Analysis (CVP analysis)
As an accounting graduate, I deemed it necessary to discuss the double entry accounting system, which is the building block for modern accounting and book keeping. Before we delve into the discussion of the double entry system, let us start with the accounting equation.
[Read more…] about Double entry Accounting
Portfolio is collection of different investments that make up an investor’s total holding. A portfolio might be:
[Read more…] about Portfolio Theory
Simply put, a business cycle refers to the fluctuations in economic activity. Little did you know how important the monthly employment report issued by the Bureau of labor statistic is to investors and portfolio managers. The two most important variables used to determine which phase an economy is in, in the business cycle is the Real GDP (Gross Domestic Product) of the economy and the rate of employment. So you see why the information on employment provided by the bureau of labor statistics is very important.
[Read more…] about Business Cycle
In the previous discussion of time value of money (present value and future value), we derived the formula for a single payment that would be discounted or compounded respectively over a period of time (n) at an interest rate r. What if we have a series of payments of a fixed amount for a specified number of periods? Then we need to use a present or future value of an annuity formula.
[Read more…] about Annuity (Present value and future value)
It is said that as dollar today is worth more than a dollar to be received tomorrow or at a later date. This is due to the uncertainty that it would actually be received tomorrow and some other variables such as inflation, interest rate and so on. It is only natural to prefer certainty over uncertainty that is why most people prefer to receive money now than to be promised the same at a later date in the future.
[Read more…] about Time value of money
