Iasmentor would like to announce to all its readers that it has been taken over by Econopedia. All future updates, replies and products will be available on econopedia.wordpress.com from now on. So the readers are requested to refer to the same in the future.
January 22, 2009
An IPO(Initial Public Offering) is a method to raise funds by a company which has been so far privately owned but now wants to offer its shares to the general public through
the share market. Usually companies which havr made a fair bit of progress and want to get to the next level adopt this method. It allows the company to reach a large
pool of investors to acquire a substantal amount of money to finance its upcoming projects. The existing shareholders have to dilute their shares in order to accomodate
the investor’s share in the hope that additional capital and resultant boost in the company’s performance will enhance the value of comapny’s share.
How is it different from the normal share trading?
It is the first step of the company in going public..ie raising funds through the general public. The funds go directly from the share buyer to the company, instead of share market
(or the secondary market) where the money just exchanges hands between various investors in the market. This is one reason why the IPO market is also reffered to as the
Primary Market. The company is not obliged to repay the capital, but the investor has a right to future profits distributed by the company and the right to a capital
distribution in case of a dissolution.
How it is done??
the companies cannot directly enter the market and offer shares to the public. For this they need an uderwriter. The job of the underwriter is to determine the form, price
and structure for the IPO. The underwriters work on a commission basis, based on a percentage of the value of the shares sold.
Underwriters, therefore, take many factors into consideration when pricing an IPO, and attempt to reach an offering price that is low enough to stimulate interest in the
stock, but high enough to raise an adequate amount of capital for the company. The process of determining an optimal price usually involves the underwriters
arranging share purchase commitments from leading institutional investors (insurance companies, mutual funds etc.)
January 13, 2009
This is to announce that w.e.f. 14th January’2009, IAS Mentors is merging itself with Neo-Knowledge, which is pioneering the revolution in transforming managemnt students into real professionals who can adapt to the dynamic corporate enviornment of today. IAS Mentors will continue to give quality material to IAS students but now management students can enroll themselves FREE OF COST with IAS Mentors to recieve quality material on Indian Economy along with other benifits. For further information, please visit campusyogi.com, the online platform for Neo-Knowledge.
October 21, 2008
We have got many queries from students asking about the impact of the ongoing slowdown/recession on the Indian Economy.
Yes, the Indian econmy will get affected because it has become global in nature over the years since economic reforms took place in 1990s. Many of its key sectors like IT, BPO are linked to the global economy and are directly impacted by global happenings. But the question is: Is the situation as bad as in the US?
The answer is NO. You have to see the stuctural facts. People in India are panicking because the sensex is diving down. But it has to be understood that sensex is no indiacator of economic-well being of a country. There is a difference between Dow going down and Sensex going down. In the former, the fall is happenning due to a sever credit crunch and resultant bankruptcy of key financial institutions, all which has taken place due to a bursting of the housing bubble. so there is a proper economic problem in the US which is taking toll on its stock markets.
Coming to India, sensex is going down because the FIIs which had invested hugely in Indian stock markets are taking the money back by selling their stocks to refuel their declining coffers in the US. There is nothing wrong as such in the Indian economy. All our banks are maintianing global standards of liquidity and their exposures in speculative sectors like the real estate have been kept to minimal thanks to the RBI. Our inflation rate is coming down due to fall in commodity prices and our growth rate is still one of the best in the world. so there is nothing to be panicky about.
Many experts are citing the recent sacking of Jet employees as an indiactor of Indian economic recession. I would tend to disagree because the sacking took place because the company felt it needed restructuring according to its means and needs. anyway, fall in fuel prices will see some relied for the airline industry in the near future. it is a sector-specific phenomena and shouldnt be linked to the whole economy.
by:
Mukul Sharma
IAS Mentors
March 21, 2008
1. ‘Las Malvinas’ are better known by what name?
(a) Canary Islands
(b) Falkland Islands
(c) The Azores
(d) Straits of Gibraltar
2. This city is at the eastern end of the Trans-Siberian Railroad.
(a) Vladivostok
(b) Mockba
(c) Chelyabinsk
(d) Moscow
3. Lake Ladoga is closest to which of these cities?
(a) Kyoto
(b) Nagoya
(c) Hiroshima
(d) St. Petersburg
4. Which of these are all real places in or near London?
(a) Battersea, Shepherdton, Millton and Belton
(b) Dorking, Wapping, Tooting and Epping
(c) Tooting, Essing, Sonning and Battersea
(d) Frisking, Belting, Sonning and Manning
5. What is the southernmost capital city of any country in the world?
(a) Canberra, Australia
(b) Santiago, Chile
(c) Wellington, New Zealand
(d) Port Stanley, Falklands
6. Tanzania was formed when what two African states combined and achieved independence?
(a) Zanzibar and Tanganyika
(b) Zambia and Zanzibar
(c) Zambia and Tangiers
(d) Zambia and Tanganyika
7. Journeying eastward, what is the next major expanse of water you would reach after the Black Sea and the
Caspian Sea?
(a) Lake Baikal
(b) Sea of Japan
(c) Sea of Azov
(d) Aral Sea
8. Put the continents in matching order with these mountains: Kosciusko, Atlas, Erebus, Ben Nevis, Denali
(a) South America, Australia, Antarctica, Europe, North America
(b) South America, Africa, Europe, Australia, North America
(c) Australia, Africa, Antarctica, Europe, North America
(d) Europe, Africa, Asia, Antarctica, North America
9. What river runs through the city of Vienna?
(a) Rhine
(b) Rhone
(c) Volga
(d) Danube
10. On a world map, which of these rivers flows most ‘horizontally’?
(a) Nile
(b) Amazon
(c) Mackenzie
(d) Mississippi
11. The capital city of the Incan Civilization, which once thrived high in the South American Andes, was called…
(a) Machhu Pichhu
(b) Cuzco
(c) Huascar
(d) Titicaca
12. There are two ‘Christmas Island’s in the world, what two oceans can they be found in?
(a) Atlantic and Pacific
(b) Indian and Pacific
(c) Atlantic and Arctic
(d) Arctic and Indian
13. What is the name of the cold current which runs up the western South American coast?
(a) La Nina Current
(b) Humboldt Current
(c) del Fuegan Current
(d) Gulf Stream
14. Germany handed control of South West Africa to South Africa who in turn granted independence to the nation
which is now known as…
(a) Mozambique
(b) Zimbabwe
(c) Angola
(d) Namibia
15. On the subject of getting things done, which of these statements holds the most truth?
(a) The Panama Canal was completed first.
(b) The Suez Canal was completed before the Panama Canal.
(c) The Suez Canal was completed, but not freely opened before the Panama Canal.
(d) They were completed within a year of each other
16. Which answer has these countries or territories correctly listed from north to south?
(a) North Korea, Pakistan, Latvia, New Caledonia, Fiji
(b) Latvia, North Korea, Pakistan, Singapore, New Caledonia
(c) Latvia, Pakistan, Singapore, North Korea, Fiji
(d) New Caledonia, Latvia, Pakistan, North Korea, Fiji
17. What country would you be in, if you took a bus from Dumfries to Gorbals?
(a) Scotland
(b) The Netherlands
(c) Belgium
(d) Canada
Answer key: 1. (b) 2. (a) 3. (d) 4. (b) 5. (c) 6. (a) 7. (d) 8. (c) 9. (d) 10. (b)
11. (b) 12. (b) 13. (b) 14. (d) 15. (b) 16. (b) 17. (a)
March 19, 2008
After a lot of queries from the students, we would like to announce the opening of General Studies Test Series by IAS Mentors. We are uploading a sample of Geography questions in this post. Students who would like to subscribe for our test series can call us or mail to us right away. The questions are designed in a manner that would test the analytical prowess of the students and prove a big step on their way to success
March 16, 2008
Did it sound rude to you?it should. because you should know what a lazy bum you are. you’re tired, exhausted? studies getting to you? too much to do? too less time?
what do you think of yourself?
let me tell you.
you think too lowly of yourself. you dont realise what lies inside of you. you define your limits and tell yourself this is it. you cant go beyond it. but you’re so wrong.
February 16, 2008
“All in all, its just a brick in the wall..” – Pink Floyd
What is it about you that is different? What makes you special? Actually, what makes “YOU”? Have you ever taken a moment and thought about this?
All day we set about our daily lives, working to achieve our goals, to reach somewhere, to realize a dream. But do we stop and ponder over what we are right now and what do we want to be?
And what are those goals anyway? Let’s say you want to become a bureaucrat. What is in you that makes you eligible to become one? Are you intelligent? Are you well-balanced? Are you knowledgeable? What is it about you?
It is very important to think about these questions because this will give a better understanding of yourself. And life in general and any great task in particular is nothing but a journey of self-realization. You discover yourself when you set about doing something. You discover yourself when success kisses your feet or failure looks in your eye. Someone said in a great movie “you never truly get to know yourself unless you’ve been in a fight”.
Now why do you need to waste time in thinking about yourself. You might say that you’d rather work/study in that time. Very true. But life is like a game of chess. To reach your goal (victory), you would have to know about your various moves to choose the right ones for the right moments. If you don’t know what your queen is and what she does, you are in for a big trouble.
Running this race is fine, its fun. But an athlete who wins is an athlete who knows himself. So many people run races, but there’s only one winner. So many batsmen play cricket, but there is only one Sachin, So many play tennis, but there is only one Roger Federer.
So many aspire, only one achieves.
Why?
Because he is the one who knows himself. And who always wants to get better. He is the one who is constantly measuring himself. He is the one who is NEVER SATISFIED. He is the one who gets up in the morning when every body else is sleeping. He is the one who never says “enough for today!”. He is the one who does not give up. He sees OPPORTUNITY in roadblocks. He is the one who stays humble and focused in success. He is the one who LEARNS.
He is the one who wins.
How do you define success?
Medals? Trophies? Ranks? Titles? Press interviews? BMWs? Blondes? Page3 parties?
NAH!
Ask any of these achievers how would they describe their success and they will always tell you that its what they’ve become in achieving all these things that is the real success.
Its not an idealistic view, but a very practical one.
You set a goal. You measure yourself. There are so many others that match you or surpass you. You work hard. You get ahead of some. You work hard. You get ahead of some more. You work harder still. And finally you will get ahead of all. THAT is the key.
But unless you stop and measure yourself, you will never get to know where you are, where you want to be, and how to get there. For reaching B from A, you need to know both B and A. many people know their Bs, but since they don’t stop and get to know their As, they don’t get to their Bs.
What do you do then, once you do measure yourself. You look at two things – where others are, and where CAN you be.
And what is more important?
The latter.
Why?
Who is your greatest enemy/competitor/foe?
You might have rattled off many names, but I will give you an advice.
Get up and reach the closest mirror available.
Let me introduce you to your greatest rival.
YOURSELF.
If you are not the best around, fight yourself. Because it is you yourself that is stopping you to be one. That’s very true. If we are not what we can be, we have no one else to blame but ourselves.
Your greatest enemy manifests itself in various forms – indiscipline, laziness, anger, jealousy, distraction, procrastination.
This is the army you fight. And you have a battle on your hands.
So ask yourself. What sets you apart.
February 11, 2008
A student called Sankalp asked us this question and as apprehended by him, this is not that stupid a question. Simply, why does the RBI not choose to simply print more money instead of thte country taking more loans from the IMF and world bank.
Well, its a good idea in a perfect world but unfortunately, the world and especially the economy does not work that way.
If the RBI simply prints more money, that will mean that the people, with extra money will demand more goods and service,s which in turn, will increase the prices of those goods and services which will increase the amount of inflation in the country.
February 11, 2008
Impact of Capital Inflows on Exchange Rate, Inflation and Stock Market Index
Posted by iasmentor under Doubts and questions[5] Comments
As requested by John, we are explaining the impact of Capital inflows on Exchange Rate, Inflation and Stock Market Index.
When more capital flows into the country, the currency appreciates in value and the inflation increases.
This is because as the the supply of more dollars in the economy increases, it is bound to decrease its price. So if one dollar used to cost 40 rupees, then if the supply of dollars will increase, the price of dollar will go down to say 39 rupees.
Also with more dollar flowing into the market, there will be too much money chasing too few goods and services, i.e. excess demand of goods and services, which will increase inflation.
Also, when more money flows into the country in the form if FII, that increases the investment into the securities of companies listed on the stock exchanges. This leads to appreciation of the value of the securities as a result of increase in their demand. And as the value of individual or important securities increase, the stock market index as a whole will also rise accordingly.
