main ones that will be evaluated include net present value, internal rate of return, payback method and unadjusted rate of return. The first two are the most accurate and popular methods, but the other two methods are used as well. These methods can be used by themselves but are more accurate and effective if used in combination for the management team to have more information to base a decision on. The Net Present Value (NPV) is the present value of future cash inflows minus the cost of the investment
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earn income and improve their lives through all difficulties in the economic conditions. People also save some of their income for their future needs. Their save money would be affected by inflation and their purchasing power would be diminished. Inflation is mostly a matter of monetary policy which occurs when a government prints money without real asset backup more than the amount that is need for a stable economy. This study examined the effects of implementation of Islamic currency on the prevention
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OF ARTS AND SOCIAL SCIENCES DEPARTMENT OF ECONOMICS AND STATISTICS COURSE UNIT: EC223 MONEY AND BANKING DATE OF SUBMISSION: NAME: KALULE RICHARD REG NO: 10/U/66/BEK/GV SIGNATURE Money can be defined as any thing that is generally acceptable as a medium of exchange. It can also be defined as a third commodity that is introduced between two other commodities to facilitate exchange. Money can therefore be looked at as an instrument that helps in fulfillment of contracts, discharge
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fixed mass of gold (Mayer 76). With respect to this definition, the gold standard is thus a monetary system whereby the value of currency of a given country is determined by a fixed mass of gold. In addition, the domestic currency of such a country can easily be converted into gold. To ensure that the domestic currency of a country can easily be converted to gold, the amount of money that is in circulation is normally equivalent to the gold reserves that that a specific country has. In addition, countries
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an important role (1) A rise in the money stock. A rise in the money stock must, for logical reasons, reduce the exchange value of a money unit. This is because the additional money unit can be used to satisfy an additional end that is necessarily less urgent than the satisfaction of the preceding end. A rise in the money stock will thus necessarily lead to a decrease in the marginal utility of the money unit (compared to the situation in which the money stock had remained unchanged). (Polleit
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factors of production and each receives payment for its participation in production: labor is paid wages, capital is paid interest, land is paid rent and entrepreneurship is paid profit. There are always two directions to the flows in the economy – the money to purchase something is moving in one direction, the good or service being purchased is moving in the opposite direction. Households sell the four inputs to the production sector and receive payment back. Households then spend most of their
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Question 1: Proficient-level: "List and describe the purpose of each part of a time line with an initial cash inflow and a future cash outflow. Which cash flows should be negative and which positive?" (Cornett, Adair, and Nofsinger, 2016, p. 95). The cash flow timeline is a visual depiction of inflows and outflows relative to the period under consideration. Cash flows are illustrated above the cash flow line with the corresponding periods that apply appearing under the cash flow diagram. Inflows
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It includes making financial decisions, developing and achieving financial goals, financial planning, budgeting, tax management, money management plan , use of credit cards, borrowing, saving plans, major expenditures, risk management, managing debts, investments, retirement planning, and estate planning. Personal financial planning is the process of managing your money to achieve personal economic satisfaction. Why is financial planning important? A good financial plan can enhance the quality
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all consumers, rich or poor, is afected by movements in interest rates, exchange rates, and the rate of inflation. Businesses stand to gain or lose considerable amounts of money when their economic environment changes, regardless of how well they are managed. Being prepared for such changes in fortunes can have considerable value; more generally, it makes us all better citizens able to grasp the complex challenges that our societies face. Macroeconomics is relevant to voters who wonder what their
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Composition of interest rates In economics, interest is considered the price of money, therefore, it is also subject to distortions due to inflation. The nominal interest rate, which refers to the price before adjustment to inflation, is the one visible to the consumer (i.e., the interest tagged in a loan contract, credit card statement, etc). Nominal interest is composed by the real interest rate plus inflation, among other factors. A simple formula for the nominal interest is: i = r + π Where
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