Business & Trade Questions & Answers

The Domino Effect is a chain reaction that occurs when a small change causes a similar change nearby, which then causes another similar change, and so on in linear sequence. The term is used as an analogy to a falling row of dominoes. It typically refers to a linked sequence of events where the time lag between successive events is …

Bonus issues are shares issued free of charge to shareholders. When a company accumulates a large fund from profits, much beyond its needs, the directors may decide to distribute a part of it among the shareholders in the form of bonus. Once a bonus is issued, the price of the shares is likely to drop as the value of the …

‘Catfish effect’ is a term used in human resource management to describe how groups are motivated by the addition of a strong competitor. The phrase comes from the practice of Norwegian fishermen, who add a single catfish into their haul of live sardines. In this way, the sardines swim vigorously to avoid contact with the catfish, and can be brought …

The anchor investor is a recently introduced category of investor in the Initial Public Offer (IPO). A Qualified Institutional Buyer who gets firm allotment in an IPO of up to 30% of the institutional quota is an anchor investor. The lock-in period for such an investor is 30 days. This is done to instill a higher degree of confidence among …

The phrase ‘sweat equity’ refers to equity shares given to the company’s employees on favorable terms, in recognition of their work. With sweat equity, employees become part owners and participate in the profits, apart from earning salaries. The Companies Act defines ‘sweat equity shares’ as shares issued to employees or directors at a discount, for providing knowhow or making available …

Rumourtrage is the practice of spreading false news about a company, leading to a drop in its stock price, and followed by increased trade in its shares. This is usually done before a takeover bid. Rumourtrage is common in the corporate world and authorities have found it tough to stamp out the practice as it hinges on hearsay. It is …

When Media like Newspapers and TVs are offered packages for everything ranging from positive coverage to negative coverage of rival parties and extensive interviews with colour photos is called Paid News. All this given for a price and sometimes the purchase of thousands of copies by the candidate.

Peanut-buttering is a term used to mean spreading resources too thin, whether money or manpower, in a manner such that it does not benefit the organization. It means, unlike what it suggests – thick creamy butter – that when it is spread, everyone has to make do with what he / she gets. A tight economy has seen taxes being …

Nankeen is a loomed fabric that is still produced by hand in some parts of China, nankeen has been around for a long time and has an illustrious history when it comes to making clothing for a number of occasions. It is named after Naking, the area within China known as Silk Road for its many fine fabrics. The demand …

Work that mainly occurs in the business processes of large companies, micro work involves workers based in the third world. The work is usually simple. Companies outsources it for a small fee as it encourages new talent in developing countries.