Month: June 2011

Observational Research

When ever there is a need of evaluating the social phenomenon, the most favorable technique is the observational research. The phenomenon of the observational research is applicable in the natural setting and is directly applied to the study area. In this type of research the manipulation of the variables is not required and no control environment is needed to be established. Types of Observation There is an interesting fact that the reliability of observational research can be challenged but its validity is commendable in contrast with experimental or qualitative research. The flexibility of application is its main incentive and attribute as the approaches are not to be followed rigidly and can be changed according to the requirements. The behavioral variables can be more likely judged by the observational techniques, while cognitive studies cannot employ this research technique. The most obvious types of observational research are covert observational research, overt observational research and researcher participation. Covert Observational Research The covert observational research, often studies as participant observation is an observation research technique, where the observation is made without prior information to the social group under study. The observation is made by the researcher either being an informal part of that group or observing through a distance. The social rules in this research are strictly obeyed ensuring that the researcher presence doesn’t harms the social settings prevailing in the particular group...

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Project Vs Securities

The damage, crime or loss in any field or perspective can be handled through security. The security is in fact a condition that implements certain structures and processes for the betterment and uplift of any project or business or a general societal setting. According the institute of security and Open Methodologies, security is in fact the separation line between assets and the threat being the form of protection, but the assets and threats are not restricted to elimination in this security argument. The studies that were conducted by the United Nations gave security the status of national condition in 1986. The forms of security are different when being dealt in different fields or disciplines. When we talk about assurance, it’s actually the security for the projects, as certain advantages or the conditions are guaranteed in it and if the risks related to the projects are entirely blocked that it is a countermeasure of the security that indeed is a security form it self. Security in a project The security was primarily addressed differently for different department like that of physical prevention, fraud avoidance and IT security for a certain project that may be of any sort related to the business or development sector. But nowadays the term Holistic security is employed to check the hazards related to different departments of the security in term of management or otherwise. The...

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Stand Alone Risk

Standalone risk refers to the involvement of the single unit or asset of the company. The risks associated with these individual entities separately, dealing one section at a time is formally known under the perspective of standalone risk. Such risks can be eliminated by freezing that particular unit with which the risk is associated. The specific assets are held for holding the risk in single section of the company as a consequence of risk measurement. The limited risk is identified in portfolio management through standalone risk. The risks associated with the projects in the company are determined as separate entities in standalone risk. The asset’s risk is in fact measured in two categories that are standalone risk and portfolio risk. Though in portfolio few risks have to be addressed but the standalone risk assessment is required for one specific asset in that portfolio. The compensation of expected risk should be kept in mind for a dealing a certain capital, ensuring the high returns on the capitals invested. The shares selling to different parties ensure the heavy returns on the investments, lowering the standalone risk. The assets which are doubted for the returns are actually posing the higher risks especially that of standalone risk.  The doubted or risky assets may not always return less on the investment but could be more as well, but the risk factor makes it difficult...

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Future Value of Annuity

Annuity The annuity is a financial term; mostly addressed in the financial theory to explain the lapsing flow of fixed payments that are considered over the set period of time. The interest rates and future value that are the concepts ruled by time value of money are mostly associated to annuity while considering payment streams. The insurance monthly payments, home mortgage payments and regular deposits to saving accounts are the general or routine examples of annuity that is often observed from day to day. The dates regarding payments decide the annuity type. Future Value of Annuity The successive payment or receipts that are received on the regular basis or equally spaced intervals is termed as annuity. In ordinary annuity the receipt session is held at the end while in annuity due the payments are to be submitted at the beginning of the session or the period. The future value of annuity calculates the future value generated by the calculating the total equal payments in the stream at the given rate at the predefined time span. Formula of Future Annuity Calculation FV = PMT [((1 + i)n – 1) / i] The FV as evident from the name is future value of annuity, PMT refers to Periodic payment amount, where as n and i refers to number of compounding periods and interest rate respectively. The future annuity actually explains the...

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Capital Structure Theory

Capital Structure The long-term financing of the company is funded through the capital structure owned by the company. It caters the whole company being a unique blend of financial sources, equity and debt. The capital developments mainly hang about a midway of equity and debt. Gearing is the only way to estimate debt in this context. The complications are obvious because other types of capitals also exists that are formed by the mixture of equity and debt. The economic effect of preference share is mot as closer to equity as debt as the returns are fixed but the debt is counted in terms of equity when it is convertible in future. In short the company’s stability or internal and external threats and opportunities are revealed by ‘debt equity ratio’, which is capital structure. The highly levered firm is considered at low risk than the company that is in high debt. The total value of the company is that is combination of its debts and equity is not affected by the capital structure as explained by the financial theories. But some time it does affects and is regarded as capital structure irrelevance. Modigliani Miller Theorem The basis of modern concept of capital structure is described by the Farnco Modigliani and Merton Miller. Few decisions related to the capital structure that are considered important are often ignored in this theorem. The...

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