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Articles on Trending Technologies
Technical articles with clear explanations and examples
How to create a bar chart for single vector using ggplot2 in R?
To create a bar chart for single vector using ggplot2 in R, we can follow the below steps −First of all, create a vector and melt it using melt function of reshape2 package and save the melted data.Then, create the bar chart with melted data using ggplot2.Create the vector and melt itCreating the vector and using melt function of reshape2 to melt the data in vector −x
Read MoreHow to divide data.table object rows by row median in R?
To divide the row values by row median in R’s data.table object, we can follow the below steps −First of all, create a data.table object.Then, use apply function to divide the data.table object row values by row median.Create the data.table objectLet's create a data frame as shown below −> library(data.table) > x y z DT DTOn executing, the above script generates the below output(this output will vary on your system due to randomization) − x y z 1: 5 3 2 2: 1 3 7 3: 6 0 13 4: 6 2 10 5: 8 1 9 6: 9 ...
Read MoreWhat is meant by Compounding?
Compounding is a process of calculating interesting rates. Unlike simple interest rates where interest rates remain the same over a period, in the case of compound interest, the interest rate goes on increasing with passing time. In the case of compounding, therefore, the wealth grows at a faster rate than in the case of simple interest.For example, a person who has invested INR 100 in a project where the interest rate is 10% would get INR 110 at the end of the first year. At the end of the second year, he should get returns for the amount of INR ...
Read MoreWhat are the differences between Debt and Equity Funds?
Mutual funds are of various nature depending on the needs and requirements of investors. However, the most common factor that separates them is their risk appetite. The riskier firms offer better returns on investment while the less risky ones provide fewer returns.There are predominantly two types of funds: Debt Funds and Equity Funds.Debt FundsDebt funds usually invest the cumulative investment of the investors in money market instruments. Some examples of money market instruments are Treasury bills, G-Secs, Non-convertible debentures, and Commercial Papers, etc. Debt funds have much lesser risk than equity funds but their return is low too.Equity FundsThese funds ...
Read MoreWhy is it important for Finance Managers to have an understanding of Capital Markets?
A Capital Market is a place where investors and borrowers deal with each other. So, a finance manager must be aware of the markets. The value of securities and how they're traded in the markets should also be in the knowledge of the manager.Capital markets are where the securities are traded and companies can invest in prospective companies that have chances to become successful in the future. However, although it might sound easy, it is a complex process altogether.Note − Capital Markets can provide good returns on investment but no one can guess it 100% right.It is complex because no ...
Read MoreWhat are Agency Problems?
The conflict between the managers and shareholders of a company is known as the Agency Problem. Agency problems may have a variety of reasons but the most common reason for such a problem to arise is due to the lack of interest in shareholder's wealth maximization.Shareholders usually invest in a company to gain the most profits and an organization that fails to provide value is deemed unsuccessful. The reasons for failing in meeting shareholders' requirements despite having profit may be due to the self-interest of managers. In such cases, the shareholders should get priority.Stakeholders BenefitsModern companies usually pay more attention ...
Read MoreWhat are the considerations for creating a good Dividend Policy?
The decisions that the management of an organization needs to take regarding the payout of dividends are known as Dividend Decisions. The companies usually want to maximize shareholders' wealth and hence a distribution policy of maximum dividend payout is required. However, if the company pays out all the profits, it may face cash constraints in the future. So, sustained earning is also necessary.Looking at all these factors, a company needs to depend on the following factors to build a good dividend policy.Note − A good dividend policy establishes faith in the shareholders' minds.Considerations for Creating a Good Dividend PolicyCash Requirements ...
Read MoreHow is Finance Function related to Management Function?
In business practices, finance-related functions and management-related functions usually overlap each other. The finance function and the management function go hand-in-hand in most cases. For example, the Operations Managers looking to install a new machine (the Management Function) must get the money which is part of the Finance Function.Usually, the finance function is the backbone of all management functions.Without financial functions, most and marketing operations will become redundant. Still, there is a fine line that separates management functions and financial functions. However, it is more important to study the overlapping situation than to look at the differences.Note − Financial and ...
Read MoreWhat are some of the important features of Investment Decisions?
Financial Managers take investment decisions for the well-being of the company. Every company seeks the best outcome from their decisions and hence every company strives to strike the best cord in terms of financial management.However, there are certain natures of investments every manager should be aware of. Finance Managers usually pay much attention to investment decisions, as these are some of the basic decisions businesses must make to survive and grow.Here are some of the characteristic features of Investment Decisions.Investment Decisions Are Long-term in NatureInvestments are meant for the long term and they have a future probability of profits or ...
Read MoreWhy is Wealth Maximization considered superior to Profit Maximization?
Although Profit and Wealth Maximization sound pretty similar, there are some major differences between them. While profit maximization aims at increasing the profit of a firm, wealth maximization has a larger role to play and it deals with the wellbeing of the stakeholders as a whole.Profit Maximization Vs Wealth MaximizationHere are some major differences between profit maximization and wealth maximization in brief.Profit and wealth maximization deal in different subjects and hence they are defined differently. Profit maximization refers to the management of a firm's resources and utilities to maximize profit. On the other hand, wealth maximization refers to managing the ...
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