World Of Finance

Money Market Instruments provide the tools by which one can operate in the money market. Common types Of Money Market Instruments are: Treasury Bills:   The Treasury bills are short-term money market instrument that mature in a year or less than that. The purchase price is less than the face value. At maturity the government pays the Treasury Bill holder the full face value. TheTreasury Bills are marketable, affordable and risk free. The security attached to the treasury bills comes at the cost of very low returns. Certificate of Deposit: The certificates of deposit are basically time deposits that are issued by the commercial banks with maturity periods ranging from 3 months to five years. The return on the certificate of deposit is higher than the Treasury Bills because it assumes a higher level of risk. Advantages of Certificate of Deposit as a money market instrument are 1. Since one can know the returns from before, the certificates of deposits are considered mu...

        World of Finance by M.Vijaya Sai Introduction: When Investment Centers have been established, these would be considered as autonomous units. They would be free to purchase their raw materials direct from the market or from their own departments. In case of the latter, there are many advantages like (i) it would be cheaper to buy from own departments, (ii) there would be more quality assurance and reliability. Also, it would be beneficial to the selling department because (i) there would no packing and external transportation costs, and (ii) there would be no bad debt. Why Transfer Pricing? Chief Executive of a big company cannot monitor and control operations of each and every sub-unit. So the sub-units are turned into Investment Centers and necessary authority is delegated to their managers.But in a decentralization, there are difficulties in evaluating the performance of the managers. Further, there is a problem of coor...