What is Profit Maximization?As the term suggests, Profit Maximization is a philosophy to maximize the profits from a business concern. In the free economy, there is always profitability if the goods and/or services are good. So, firms selling good products and services increase the prices of goods to generate more revenues and profits. After the market competition for such service providers, however, a point is reached where the maximum profit halts.This is the point of profit maximization.Note − To maximize profits, one must produce quality goods or services.The underlying cause of profit maximization is efficiency. This helps the companies to ... Read More

A financial manager plays a pivotal role in keeping the businesses intact and on track. By applying his or her knowledge, he or she builds the businesses should accept for profit maximization. He or she must also be a team player in order to coordinate the communication from the financial department to other business departments of the company.Note − No organization can succeed nowadays without good financial managers.As a dynamic member of the organization, he or she must play the following rolesDecision MakerIn the recent past, financial managers were not considered vital members of the organization. So they were excluded ... Read More

A Sinking Fund is a special fund that is created by depositing fixed payments each period to gain an estimated and fixed amount after a specific period. In other words, a sinking fund is an account that earns compound interest into which a fixed payment is made periodically for a specific period of time.A sinking fund is generally created to accumulate a fixed sum of money after a specific period. One can use the sinking fund to pay off a loan as a lump sum after a certain period. In the meantime, until the lump-sum period is reached, one can ... Read More

The interest rates paid annually by financial organizations on an annual basis are known as Nominal Interest Rates. In such an arrangement, the interest is paid at the end of each year. If compounding is done, that will also be covered under this arrangement in one shot.However, there are arrangements in which financial organizations pay interests on funds semi-annually or quarterly. For example, in the case of loans, the charges or interests may be levied semi-annually. Such an arrangement of paying the interest several times within a selected period is known as Effective Interest Rates.Nominal Interest Rate Vs Effective Interest ... Read More

Annuity Due is a payment of receipt of a fixed amount of money at the beginning of each period for a specified number of periods. It is different from general/ordinary annuity in which the payments are made after the end of each payment cycle. One may find an Annuity Due while paying rent, planning for retirement, borrowing money, or buying an annuity.Since the concept of Annuity is based on Time Value of Money, the payer usually prefers to pay ordinary annuities. This helps them have the money for coming periods. The lender, however, prefers Annuity Due because they get to ... Read More

The Kyoto protocol is an agreement signed among internal leaders to tackle the highly complicated subjected of environment. The agreement was signed on 11 December 1997 with a commitment to reduce carbon dioxide (CO2) and Greenhouse gases (GHG) emissions. The agreement chiefly enforced the developed nations to lower their industrial emissions annually.The agreement was much needed for the climate environment as the greenhouse gasses emissions threatened to disrupt the climate completely. It was around this time when environmentalists urged the world leaders to sign the treaty, this agreement was signed and named Kyoto Protocol.The agreement still exists today, and multiple ... Read More

Kuwaiti Dinar (KWD) is among the most expensive currencies among the world and is the official currency of Kuwait. The name dinar comes from the Latin word denarius, which means "denarius." The KWD is divided into 1000 fils, a coin that is widely used in Arab countries.Key Points BrieflyKuwaiti Dinar (KWD) that belongs to a small nation of Kuwait is one of the costliest currencies in the world.The currency is tied to an unidentified basket of currencies and moves in a narrow range.Example of a Kuwaiti Dinar exchange rate is shown below.The Kuwaiti dinar varied between $3.27 and $3.36 between ... Read More

Kuwait Investment Authority (KIA) is a government-owned business in Kuwait that manages the country's sovereign wealth fund. It was founded in 1982 as a spin-off of the Kuwait Investment Board to manage government funds drawn mostly from Kuwait's oil reserves' excess revenues. The fund, which is the world's first and oldest, was established to reduce the country's reliance on oil.Key Points BrieflyKuwait Investment Authority is a government-maintained company that administers Kuwait's self-governing wealth fund.The objective of Kuwait Investment Authority (KIA) to manage official government money, which is mostly made up of revenues from oil rich areas.There is diversification of funds ... Read More

Kurtosis is a statistical term used to quantify distribution that is like skewness. Unlike skewness, which only distinguishes absolute value in one tail from those in the other, kurtosis assesses extreme values in both tails. Tail data exceeds the tails of the normal distribution in distributions with strong kurtosis. The tails of ranges with low kurtosis are often less severe than the tails of a normal circulation.A high kurtosis is a trend that investors watch closely as it could result that there will be sharper results in either directions of profits or loss. This in comparison to the normal deviation ... Read More

Krugerrands are gold coins established by the Republic of South Africa in 1967 to aid in the advancement of South African gold on worldwide markets and to allow citizens to possess gold. They are one of the most popular and widely traded gold coins on the international market.Krugerrands were created with the sole purpose of deriving their worth from the gold price at the time they were traded. The price of Krugerrands fluctuates in tandem with the price of gold.Key Points BrieflyKrugerrands are gold coins manufactured in South Africa since 1967.In 1980, when the gold market was at its pinnacle, ... Read More