Explanation

• Under the Separation of Powers, the Parliament primarily performs the legislative function, such as making laws and approving the budget.
• Judicial decisions and passing court judgments belong to the Judiciary, not the Parliament.
• This principle separates the legislative, executive, and judicial functions of government.
• The aim is to prevent excessive concentration of power in one institution.

Last verified on 08-08-2026

Explanation

• Elite Theory suggests that political decisions are largely made by a small, wealthy, and powerful ruling class.
• It argues that political power and decision-making are concentrated among a limited group of elites.

Additional information:

• Systems Theory views policy-making as a process of inputs, outputs, and feedback within a political system.
• Pluralist Theory argues that power is distributed among multiple competing groups and interests.

Last verified on 08-08-2026

Explanation

• A Confederation is a voluntary association of independent and sovereign states that cooperate for common purposes.
• In a confederation, the member states retain greater sovereignty than the central authority.
• A Federation divides constitutional powers between the central government and constituent states/provinces.
• Examples of confederal arrangements include the United States under the Articles of Confederation (1781–1789) and the Swiss Confederation historically.

Last verified on 08-08-2026

Explanation

• Performance-Related Pay (PRP) links employee compensation directly to individual performance, productivity, or skill level.
• It rewards employees based on their measurable performance or achievement.
• PRP may include performance bonuses, incentives, commissions, or merit-based increases.
• Seniority-Based Pay is primarily based on an employee’s length of service.
• PRP is designed to encourage higher productivity and better performance.

Last verified on 08-08-2026

Explanation

• Game Theory is the mathematical framework used to analyze strategic interactions between rational decision-makers.
• It studies situations where the outcome of one person's decision depends on the decisions of others.
• It is widely used in economics, political science, business, and public policy.
• Key concepts include players, strategies, payoffs, and equilibrium.

Last verified on 08-08-2026

Explanation

• The Project Life Cycle consists of sequential stages used to manage a project from beginning to completion.
• Initiation defines the project and establishes its basic purpose and feasibility.
• Planning determines the scope, schedule, resources, budget, and risks.
• Execution, Monitoring & Control involve carrying out the work while tracking and controlling performance.
• Closure formally completes the project and records lessons learned.

Last verified on 08-08-2026

Explanation

• The Fisher Rate of Return is the discount rate at which the NPVs of two mutually exclusive projects are equal.
• It is also called the Fisher Intersection Rate or Fisher Rate.
• At this rate, both projects have the same NPV, so the investor is indifferent between them based on NPV.
• It is useful when comparing mutually exclusive investment projects.
• The concept is associated with economist Irving Fisher.

Last verified on 08-08-2026

Explanation

• Internal management accounting reports are not presented to external shareholders because they contain confidential information used for internal decision-making.
• Management accounting reports help managers with planning, budgeting, cost control, and performance evaluation.
• External shareholders generally receive financial accounting reports, such as financial statements.
• Financial accounting reports are prepared for external users and follow applicable accounting standards.

Last verified on 08-08-2026

Explanation

• The normal balance of a Revenue account is a Credit.
• Revenue increases owner’s equity, and equity accounts normally have credit balances.
• Revenue is credited when earned and debited when reduced or closed.
• At the end of the accounting period, revenue accounts are closed to the Income Summary/retained earnings or capital account.

Last verified on 08-08-2026

Explanation

• Fiscal Policy is the policy through which a government adjusts public spending and tax rates to influence the national economy.
• It is mainly used to promote economic growth, employment, and price stability.

Additional information:

• Expansionary fiscal policy involves increasing government spending or reducing taxes.
• Contractionary fiscal policy involves reducing spending or increasing taxes.
• Monetary Policy is managed by the central bank and focuses on money supply and interest rates.

Last verified on 08-08-2026