Can you mention one way by which the Federal Reserve controls the Money Supply in an economy?
The Federal Reserve can control the money reduce the money supply in an economy by selling government securities. Similarly, it can buy the government securities to inject more cash into the economy. This process is known as Open Market Operation.
How is WACC (Weighted Average Cost of Capital) calculated?
WACC (weighted average cost of capital) is calculated by taking the percentage of debt to total capital, multiplied by the debt interest rate, multiplied by one minus the effective tax rate, plus the percentage of equity to capital, multiplied by the required return on equity.
If I could use only 1 statement to review the overall health of a company, which statement would I use and why?
Cash. The cash flow statement depicts the overall movement of cash throughout the company. It is paid less attention to, compared to the balance sheet, but the truest picture of how much the cash the company is being able to generate to meet its expenses and pay off its shareholders and meet its other expenses.