What is troubled debt restructuring? Definition A troubled debt restructuring can be defined as the renegotiation of terms between a debtor and creditor in an effort to reduce or delay repayments while avoiding bankruptcy. A borrower may be facing financial difficulties because of cash-flow problems, market conditions, financial mismanagement, or for reasons …
What is debt servicing? Debt servicing is the repayment of a debt over a given period of time including the capital and interest. What is Debt Service? Debt service is the scheduled repayment of the principal and interest of a debt over a given time period. It is the amount needed to …
What are the principles of finance? The principles of finance are a set of ideas that help define financial principles as a whole. In financial terms, a principle is an accepted standard that guarantees the value of something. In terms of finance, then, there are a set number of principles that can …
The central bank uses monetary policy to reduce inflation by making money less available, influencing the rate at which people want to borrow money for investments (interest rates) and how much currency is in circulation (money supply). Monetary policy is generally used when fiscal policy fails. The type of policy used by …
Oftentimes, economists contrast fiscal policy with monetary policy which a country’s central bank enacts and not the elected government officials. Fiscal policy is a highly politicized aspect of an economy because it is the government that has sole control over it. In essence, it encompasses the things that the government decides to …
What is sales promotion? Sales promotion refers to a marketing strategy where a business makes use of short-term campaigns to spark up the interests of the public and create demand for a product, service, and other offers. Primarily, businesses make use of sales promotion to influence consumer behavior and motivate target consumers …
What is Financial Management? Financial management refers to the act of planning, organizing, directing, and controlling financial activities such as the acquisition and utilization of funds of an enterprise. In other words, it is the application of general management principles to the enterprise’s financial resources or possession. This activity is vital to …
What is deflation in economics? Deflation refers to a general decrease in the prices of goods and services which typically has to do with a decrease in the supply of money and credit in the economy. In essence, deflation occurs when the prices of goods and services begin to decline in the …