A country’s fiscal policy along with the monetary policy plays a crucial role in managing the growth in the economy. The main purpose of both fiscal and monetary policy is to achieve full employment, maintain or achieve high economic growth and to stabilise the price and wages.Fiscal policy refers to the use of the Government spending and tax policies to influence the … [Read more...] about Fiscal Policy: What is the purpose and its effect
What is profit after tax (PAT) and how is it calculated
PAT stands for Profit After Tax.One of the main objectives of a company is to increase shareholders wealth. It will increase only when the company earns money from its business. More money means more wealth.Due to this reason a company prepares periodical income statement to present before the shareholders. Income statement shows how efficiently the management has … [Read more...] about What is profit after tax (PAT) and how is it calculated
10 key financial metrics used by value investors to pick stocks
Key financial metrics can be helpful while finding long term investing opportunities in the stock market. One of the main objectives of a value investor is to pick a stock that they believe is undervalued. They use different financial metrics to analyse a company's fundamentals and valuation.One of the most well-known value investors Mr Warren Buffett uses fundamental … [Read more...] about 10 key financial metrics used by value investors to pick stocks
Return on Assets (ROA): How to calculate and use in financial analysis
Return on assets, popularly referred to as ROA, is a financial ratio that indicates profitability of a company in relation to its total assets for a period. Retrun on assets (ROA) shows how efficient the management is in generating profit by using the company's assets.In this article you will learn how to calculate return on assets (ROA) and how to interpret the ratio to … [Read more...] about Return on Assets (ROA): How to calculate and use in financial analysis
Why Net Profit and Cash Flows Are Different Bottom Lines
Many non-finance professionals think that a business earning a profit means its cash balance went up by the same amount. If you are one of them, then we suggest you read this article in which we have explained why a company's net profit and cash flow are two different bottom lines.A company can have higher profits while having a poor cash flow.A healthy cash flow does … [Read more...] about Why Net Profit and Cash Flows Are Different Bottom Lines