Fixed Income
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Describe matching principle of working capital financing? Explain the benefits of following this principle? The matching principle is while short-term financing is utilized for temporary current assets while long-term financing is utilized for
Expenditure Authority: The authorization to make expenditure (generally by a budget act appropriation, provisional language or some other legislation).
What are a bank's main reserves? Vault cash & deposits in the bank's account at the Fed are utilized to satisfy these reserve requirements; they are termed as primary reserves. These primary reserves are non-interest-earning assets hel
Describe decision rule for accepting or rejecting proposed projects while using internal rate of return? Whenever the internal rate of return is greater than or equal to the required rate of return, the hurdle rate, the project is accepted. Whi
Describe who owns a credit union? Credit unions are owned through their members. While credit union members put money in their credit union, they are not "depositing" the money technically. In spite of, they are purchasing shares of the cr
Availability Period: The time period throughout which an appropriation might be encumbered (that is, committed for expenditure), generally specified by the law making the appropriation. When no particular time is given in financial legislation, the pe
Security in banking operations is a major problem in financial institutions all over the world today. The compromise of banking information and data more often than not leads to fraud. Fraud has become quite a challenge for many banks as any slight br
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Public Service Enterprise Funds: For legal base accounting purposes, the fund categorization which identifies funds utilized to account for the transactions of self-supporting enterprises which render goods or services for a direct charge to user (tha
Do mergers encourage the formation of new banks? Yes. The increase in the number of new banks in the second half of the 1990s coincides with a surge in merger activity in the similar period. A study conducted through the Federal Reserve Bank of
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