Can anybody tell what is the link b/w reporate and
inflation? How these parameters vary???
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Answer / sumbul
when the Central Bank of any country increases their repo
rate ( the rate at which banks borrow from the central bank)
it eventually makes the other banks of the country increase
their prime lending rates (PLRs). when the PLRs increases
the people borrow less from the banks which leads to
reduction in demand which inturn ultimately helps in curbing
the rising inflation.
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Answer / manmohan singh
there is a grate relation between repo rate and the inflation of the country.The banks borrow from central bank at a fix rate of interest rate which is specified by the central bank to control the liquidity position in the market.Central bank decrease repo rate to inflow more liquidity in the market by which the the banks borrow more and lend to the borrower.When borrower borrow more they spend more which generate more inflation becouse the demand of the product would be more but the supply would me same as it was previous.So by this way central bank control inflation.
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Can you please help me calculate the pre tax profit for credit card for 2014 using the following Assumptions. Request you to list the steps used. Charges Late fee £12 per occurrence Over limit fee £10 per occurrence Cash fees 3% of cash withdrawal value Annual Fee £25 per account, per year Interchange 1% of transaction value KPIs Accounts overdue 10% per month Accounts over limit 15% per month Average APR 30% Balances revolving 90% of balance Average balance £900 at end of 2013 Expected growth in average balance (2014) 10% per annum Assumptions Open accounts 200,000 at 2013 year-end New accounts booked 5,000 per month Annual operating cost £50 per open account Cost of Acquisition £50 per account Provision rate 9% of total balances Annual cost of funds 4% by balance Charge off Unit charge-off rate in 2014 11% of accounts at 2013 year-end Unit charge-off rate in 2014 0% of accounts booked in 2014 Post charge-off recoveries 20% of balance Account Transactions Monthly turnover 5% of total month end balances Cash advances 20% of monthly turnover Additional Assumptions Please state any additional assumptions you have made to calculate your answer Thanks in advance,
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