Below explain the meaning of capital budgeting and its importance: Capital Budgeting: Is a decision making process of selecting and evaluating long term investments viz investing in fixed assets or capital expenditure(capex) This will require a substantial initial outlay and expect to produce benefits/results over a period of more than one year … Read more
Earlier article describe the basics of Business Risk. Append below are the major factors that affects or influence Business Risk: 1. Intensity of Competition-The higher the level of competition, the higher the business risk 2. Higher Fixed Cost Structure-Generally, if a business has higher fixed costs it will result in higher business risk. If the business’s … Read more
Unsystematic risk or unique or specific risk which is diversifiable can be further classified into business risk and financial risk Append below some basic points on Business Risk: Business Risk Dependent on economic conditions and management’s decision with respect to capital investment. Concerned with the uncertainty associated with an investment’s earnings and the investment’s ability … Read more
Earlier article refer to the theories of International trade. Append below in salient points Porter’s Diamond Theory Michael E Porter’s Diamond Theory: Advocates the following: A nation could create new advanced factor endowments like skilled labor, strong technology and knowledge base, government support and culture. He used a diamond shaped diagram as the basis of … Read more
Append below in salient points the advantages and disadvantages of economic integration: Advantages Of Economic Integration Trade Creation: Member countries have (a) wider selection of goods and services not previously available; (b) acquire goods and services at a lower cost after trade barriers due to lowered tariffs or removal of tariffs (c) encourage more trade … Read more
Append below in salient points the meaning and level of economic integration: Meaning of Economic Integration: A process whereby countries cooperate with one another to reduce or eliminate barriers to the international flow of products, people or capital Takes place either on region or commodity Levels Of Regional Economic Integration: Five levels of regional integrations: … Read more