Monthly Archives: July 2009

Insurance Policy – Part I

Something Interesting about Insurance Policy. I have always wondered how the Insurance works and I have written previously also many articles regarding the same. This is just to give you a better view of things.

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Let’s discuss some case studies here:

Case A:

Suppose I give you a choice to make of the 2 available options:

  1. A bet in which you will surely loose 50 Rs. (100% chance of loss)
  2. A bet with 25% chance of Loss of 200 Rs, and 75% chance of Zero Loss

Which one will you choose? Think about it carefully, before making your choice and before reading further.

Some people select choice 1, other select choice 2. What have you selected? Continue reading

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Warren Buffet Quotes

As most of you are aware, Warren Buffet is known for his investing skills. He is acknowledged as the World’s Best Investor. You can get loads of information from the net regarding the guru of investment. He owns the “Berkshire Hathaway”, which a billion dollar company. He shares his secrets to the whole world on the day of Annual Meeting. His Annual meetings are generally attended by more than 50,000 people. It is always a pleasure to read the annual statements from his site. I would urge you to have a look at it. Continue reading

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Representative Money

Representative money is symbolic money. it does not consist of coins or rupees, but of tokens or certificates. These tokens or certificates can be exchanged for a fixed quantity of gold, silver, water, oil or food. Representative money is directly linked to the commodity that backs it. Continue reading

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One Buyer, One Seller

I was just wondering what would happen to the value of a commodity if there was only one buyer and only one seller. I know it won’t happen with a commodity, but just a thought. Generally for any commodity there will be more than one buyer and seller.

These days the economic situation is not so good and mostly many people are not trading. If at all they are trading I am sure someone is not getting a fair price either the seller or the buyer. Whenever there are many buyers and sellers for a particular commodity then the price of the commodity will be fair. It is just that the competition between the buyers and sellers ensure that the price is fair. Commodities which are not fast moving and have considerable shelf life are not sold by the seller, they wait for the buyer. Continue reading

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Fringe Benefit Tax

Fringe Benefit Tax is the brain child of P.Chidambaram, the then Finance Minister of India. It was imposed in the year 2005. This guy knew how to take the money out from the common man in every possible way. It reminds me of the 1996 budget where he introduced the Competition Post card. This was very unique I hadn’t heard of it, he might have followed someone’s idea but the credit goes to him. Continue reading

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