CTS - Analytical Reasoning

CTS – Analytical Reasoning

1. Out of forty students, there are 14 who are taking Physics and 29 who are taking Calculus. What is the probability that a randomly chosen student from this group is taking only the Calculus class?

Ans: 0.65 = 65%.

The total number of students is 40. Number of students taking Physics and Calculus are 14+29=43.

Thus 3 students are taking both Physics and Calculus. Hence, the number of students taking only Calculus is 26 and the probability is 26C1 / 40C1 = 0.65 or 65%

2. In town of 500 people, 285 read Hindu and 212 read Indian express and 127read Times of India 20 read Hindu and times of India and 29 read Hindu and Indian express and 35 read Times of India and Indian express. 50 read no newspaper. Then how many read only one paper?

Ans: 450

People reading only Hindu   =    285 – (20+29) = 236.   (Through Venn diagram these figures can be

People reading only Express =    212 – (29+35) = 148    arrived at)

People reading only Times    =    127 – (35+20) =   72

Total                                                                              456 (less 6 who read all the three papers) = 450.

3. In a group of persons traveling in a bus, 6 persons can speak Tamil, 15 can speak Hindi and 6 can speak Gujarati. In that group, none can speak any other language. If 2 persons in the group can speak two languages and one person can speak all the three languages, then how many persons are there in the group?

A) 21      B) 23      C) 22      D)24

Ans: B

Let us assume the two persons who can speak two languages speak Hindi and Tamil. The third person then speaks all the three languages.

Tamil – Number of persons who can speak is 6. Only Tamil 6 – 2 – 1 = 3

Hindi -  Number of persons who can speak is 15. Only Hindi 15 – 2 – 1 12

Gujarati – Number of persons who can speak is 6. Only Gujarati 6 – 1 = 5

Thus the number of persons who can speak only one language is 3 + 12 + 5 = 20

Number of persons who can speak two languages                                            =  2

Number of person who an speak all the languages                                            =   1

Total number of persons                                                                               = 23.

4. Out of a total of 120 musicians in a club, 5% can play all the three instruments- Guitar, violin and Flute. It so happens that the number of musicians who can play any two and only two of the above instruments is 30. The number of musicians who can play the guitar alone is 40. What is the total number of those who can play violin alone or flute alone?

A) 30      B) 38      C) 44      D) 45

Ans: C

Out of total 120 musicians 40 can play only Guitar. That leaves remaining 80 persons of which 30 can play only two or any two instruments. Excluding this we now have 50 persons of which 6 persons (5% of 120) can play all the three instruments. Excluding this we now have 44 persons who can now either play Violin or flute alone.  

5. In a town 65% people watched the news on television, 40% read a newspaper and 25% read a newspaper and watched the news on television also. What percent of the people neither watched the news on television nor read a newspaper?

A) 5        B) 10      C) 15      D) 20

Ans: D

People watching Television is 65%. People watching only Television is 65% - 25% = 40%

People reading newspaper is 40%. People reading only newspaper is 40% - 25% = 15%

Thus percentage of people watching TV, reading newspaper and

Both TV and newspaper is   40% + 15% + 25% = 80%

Hence percentage of people neither watching TV nor reading newspaper is  100% - 80% = 20%                

Directions for Questions 6-10:

Each question given below has a problem and two statements numbered I and II giving certain information. You have to decide if the information given in the statements is sufficient for answering the problem. Indicate your answer as

(a) If the data in statement I alone are sufficient to answer the question;

(b) If the data in statement II alone are sufficient to answer the question;

(c) If the data in either in I or II alone are sufficient to answer the question;

(d) If the data even in both the statements together are not sufficient to answer the question;

(e) If the data in both the statements together are needed;

6. How many visitors saw the exhibition yesterday?

I. Each entry pass holder can take up to three persons with him / her.

II. In all, 243 passes were sold yesterday.

Ans:D

7. How much was the total sale of the company?

I. The company sold 8000 units of product A each costing Rs. 25.

II. The company has no other product line

Ans: E

8. In what proportion would Raj, Karan and Altaf distribute profit among them

I. Raj gets two-fifth of the profit.

II. Karan and Althaf have made 75% of the total investment.

Ans: D

9. What time did the train leave today.

I. The train normally leaves on time

II. The scheduled departure is at 14.30.

Ans: D

10. On which day in January, Subhas left for Germany

I. Subhas has so far spent 10 years in Germany.

II. Subhas’ friend Anil left for Germany on 15th February and joined Subhas 20 days after Subhas’ arrival.

Ans: D.

Directions(11-15): A cube is colored orange on one face , pink on the opposite face, brown on one face and silver on a face adjacent to the brown face. The other two faces are left un-colored. It is then cut into 125 smaller cubes of equal size. Now, answer the following questions based on the above statements:

11. How many cubes have at least one face colored pink?

A) 1        B)9         C) 16      D) 25

Ans: D

12. How many cubes have all the faces un-colored?

A) 24      B)36       C) 48      D) 64

Ans:C

13. How many cubes have at least two faces colored?

A) 19      B)20       C) 21      D) 23

Ans: C

14 How many cubes are colored orange on one face and have the remaining faces uncolored ?

A) 8        B) 12      C) 14      D) 16

Ans: D

15 How many cubes are colored silver on one face , orange or pink on another face and have four uncolored faces?

A) 8        B) 10     C) 12      D) 16

Ans: A

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Ten Common Financial Terms

10 Common Financial Terms  

(Courtesy: Investopedia)

For many beginners, tuning into CNBC or reading the average financial blog post can be a pretty alienating experience, especially when most of the content is inundated with technical lingo. While most news covers sports and politics in a largely intuitive language that caters to a wide audience, stock market news is typically delivered to more educated, affluent demographic that is assumed to be well-versed in investing jargon – even more so in updates reporting the quarterly successes of a publicly traded company.

In order to get a better understanding of what you read, we’ll briefly explore the terms you commonly encounter in market news – specifically when a company announces its earnings. This article will illustrate where you will see these words, what they mean, and what they pose for a company using excerpts from an earnings news report covering a fictional company, Hemlock Incorporated. 

Earnings Announcement
Hemlock Incorporated announced its fiscal 2013 Q2 results after the markets closed, reporting non-GAAP earnings per share of 67 cents, an increase of 17% from last quarter, coupled with a net income of $250 million, up from $235 million. Earnings guidance from Hemlock Incorporated fell within range, with EBITDA, Net Income from continuing operations, and free cash flow beyond the high-end of their respective guidance ranges.

Highlights from the second quarter of 2013 include:

• Cash and cash equivalents of $128 million.
• EBITDA increase of 19% from Q1.
• Free cash flow of $35 million, up from Q1’s $32.70.
• Total debt increased from $95 million to $100 million.

However, despite the 17% EPS gain, Hemlock Incorporated missed well below the Analyst earnings estimate of 71 cents. Coupled with Hemlock’s increasing total debt, some analysts are left questioning the company’s ability to service its debt moving forward. 

3 Common Terms
Net income (NI) in its most basic definition refers to a company’s total earnings, or profit. Simply put, NI is the difference calculated when subtracting expenses from revenue. When a company’s NI increases, it’s normally a result of either revenue increasing or expenses being slashed. It goes without saying that an increase in NI is generally perceived as a positive thing and factors into a stock’s performance. Earnings before Interest, Tax, Depreciation, and Amortization (EBITDA) compare to NI paints a rawer image of profitability. While some proponents of EBITDA argue that it’s a less complicated look at a company’s financial health, many critics state that it oversimplifies earnings, which can create misleading values and measurements of company profitability. As a new investor, it’s important to know the distinction between like measurements, as the market allows firms to advertise their numbers in ways not otherwise regulated.

For instance, often companies will publicize their numbers using either GAAP or non-GAAP measures. GAAP, or Generally Accepted Accounting Principles, outlines rules and conventions for reporting financial information. Basically, GAAP is a means to standardize financial statements and ensure consistency in reporting. When a company publicizes their earnings and includes non-GAAP figures, it means they want to provide investors an arguably more accurate depiction of the company’s health, like removing one-time items to smooth out earnings. However, the further away a company deviates from GAAP standards, the more room is allocated for some creative accounting and manipulation (like in the case of EBITDA). When looking at a company publishing non-GAAP numbers, new investors should be careful of these pro-forma statements, as they may differ greatly than what GAAP deems acceptable.

Finally, EPS is one of the most common things brought up during an earnings announcement, and it provides investors insight into a company’s earnings health and often affects its stock price after an announcement. EPS is calculated by taking net income, subtracting the preferred dividends (for the sake of simplicity, let’s assume Hemlock Incorporated doesn’t offer dividends on preferred shares), and taking that difference and dividing it by the average number of outstanding shares. In the case of Hemlock, its current quarterly EPS is calculated by dividing its NI of $25 million by the company’s 37 million outstanding shares. When reported, EPS is typically compared up against EPS from either the previous quarter or year-after-year. As well, it is used in basic valuation calculations like the P/E Ratio.

Cash in Hand, Money in the Bank
Another things most news reports look at is how companies manage their money – specifically, how much they have in free cash flow, total debt, and what assets they have available in cash equivalents such as short-term government bonds that they can sell to settle debts. In Hemlock Inc’s announcement, free cash flow is increasing, meaning that after all expenses have been laid out in order to maintain the business’ continuing operations, the amount of cash it has on hand is growing. On Hemlock’s balance sheet, the company maintains cash and cash equivalents of $128 million, which can be converted into cash if required, especially in the event that their increasing total debt increases and their income takes a hit. When reading about a company’s quarterly success or failure, pay attention to these terms. How effectively a company handles the cash it possesses and how it pays down its debt are both indicators of their ability to grow and add value to their shareholders’ portfolios.

Plans and Expectations
Despite Hemlock has seen numbers jump in various areas over the past quarter, the fact that it missed analyst estimates doesn’t bode well for investor confidence. Earnings estimates are forecasted expectations of earnings or revenue based on projections, models and research into the company’s operations. Earnings estimates are most frequently published by financial analysts. When the company itself publishes its predicted earnings, it’s commonly seen or heard in the media as “guidance.”

Even if a company sees an increase in profitability, if the actual earnings fall below expected earnings, the market will see to it that the stock price adjusts to the new information (read: drop in value.) This is due to the fact that estimates are built into the current price of a stock. Thus, when investors hear how a company “missed expectations” in spite of higher revenues being reported, the market corrects the price of the stock accordingly.

The Bottom Line 
Like anything else in life, learning how the financial markets work takes some time. Taking the easier approach and maintaining a level of ignorance can be dangerous, especially when it is the company’s prerogative to preserve investor confidence by using as many positive values as possible. Knowing what each term mean, why they are being used, and understanding how they affect stock price are just a few ways beginners can gain a better knowledge of the financial markets, as well as gain critical-thinking skills when it comes to financial news.

The Basics of Currency Trading

The Basics of Currency Trading

(Courtesy: Investopedia)

The investment markets can quickly take the money of investors who believe that trading is easy. Trading in any investment market is exceedingly difficult, but success first comes with education and practice. So, what is currency trading and is it right for you?

The currency market, or forex (FX), is the largest investment market in the world, and continues to grow annually. On April 2010, the forex market reached $4 trillion in daily average turnover, an increase of 20% since 2007. In comparison, there is only $25 billion of daily volume on the New York Stock Exchange (NYSE). The market may be large, but until recently the volume came from professional traders, but as currency trading platforms have improved more retail traders have found forex to be suitable for their investment goals.

How Does It Work?
Currency trading is a 24-hour market that is only closed from Friday evening to Sunday evening, but the 24-hour trading sessions are misleading. There are three sessions that include the European, Asian and United States trading sessions. Although there is some overlap in the sessions, the main currencies in each market are traded mostly during those market hours. This means that certain currency pairs will have more volume during certain sessions. Traders who stay with pairs based on the dollar will find the most volume in the U.S. trading session.

Currency is traded in various sized lots. The micro lot is 1,000 units of a currency. If your account is funded in U.S. dollars, a micro lot represents $1,000 of your base currency, the dollar. A mini lot is 10,000 units of your base currency and a standard lot is 100,000 units.

Pairs and Pips
All currency trading is done in pairs. Unlike the stock market, where you can buy or sell a single stock, you have to buy one currency and sell another currency in the forex market. Next, nearly all currencies are priced out to the fourth decimal point. A pip or percentage in point, is the smallest increment of trade. One pip typically equals 1/100 of 1%.

Retail or beginning traders often trade currency in micro lots, because one pip in a micro lot represents only a 10 cents move in the price. This makes losses easier to manage if a trade doesn't produce the intended results. In a mini lot, one pip equals $1 and that same one pip in a standard lot equals $10. Some currencies move as much as 100 pips or more in a single trading session making thepotential losses to the small investor much more manageable by trading in micro or mini lots.

Far Less Products
The majority of the volume in currency trading is confined to only 18 currency pairs compared to the thousands of stocks that are available in the global equity markets. Although there are other traded pairs outside of the 18, the eight currencies most often traded are the U.S. dollar (USD), Canadian dollar (CAD), euro (EUR), British pound (GBP), Swiss franc (CHF), New Zealand dollar (NZD), Australian dollar (AUD) and the Japanese yen (JPY). Although nobody would say that currency trading is easy, having far less trading options makes trade and portfolio management an easier task.

What Moves Currency?
An increasing amount of stock traders are taking interest in the currency markets because many of the forces that move the stock market also move the currency market. One of the largest is supply and demand. When the world needs more dollars, the value of the dollar increases and when there are too many circulating, the price drops.

Other factors like interest rates, new economic data from the largest countries and geopolitical tensions, are just a few of the events that may affect currency prices.

The Bottom Line
Much like anything in the investing market, learning about currency trading is easy but finding the winning trading strategies takes a lot of practice. Most forex brokers will allow you to open a free virtual account that allows you to trade with virtual money until you find strategies that work for you. 

 

The Power of Sanctions between Countries

The Power of Sanctions between Countries

(Courtesy: Investopedia)

A sanction is a penalty levied on another country. It is an instrument of foreign policy and economic pressure that can be described as a sort of carrot-and-stick approach to dealing with international trade and politics.

A country has a number of different types of sanctions at its disposal. While some are more widely used than others, the general goal of each is to force a change in behaviour.

A sanction can be exercised in several ways. These include:

• Tariffs – Taxes imposed on goods imported from another country.
• Quotas – A limit on how many goods can be either imported from another country or sent to that country.
• Embargoes – A trade restriction that prevents a country from trading with another. For example, a government can prevent its citizens or businesses from providing goods or services to another country.
• Non-Tariff Barriers (NTBs) – These are non-tariff restrictions on imported goods and can include licensing and packaging requirements, product standards and other requirements that are not specifically a tax.

Types of Sanctions
Sanctions are categorized in several ways. One way to describe them is by the number of parties issuing the sanction. A "unilateral" sanction means that a single country is enacting the sanction, while a "bilateral" sanction means that a group or block of countries is supporting its use. Since bilateral sanctions are enacted by groups of countries, they can be considered less risky because no one country is on the line for the sanction's result. Unilateral sanctions are more risky, but are more likely to be effective if enacted by an economically powerful country.

The second way sanctions can be described is by the types of trade they limit. Export sanctions block goods flowing into a country, while import sanctions block goods leaving the country. The two options are not equal and will result in different economic ramifications. Blocking goods and services from entering a country (an export sanction) generally has a lighter impact than blocking goods or services from that country (an import sanction). Export sanctions can create an incentive to substitute the blocked goods for something else. A case in which an export sanction could work is the blocking of sensitive technological know-how from entering the target country (think advanced weapons). It is harder for the target country to create this sort of good in-house.

Blocking a country's exports through an import sanction increases the possibility that the target country will experience a substantial economic burden. For example, on July 31, 2013 the U.S. passed the bill H.R. 850 that basically blocked Iran from selling any oil abroad because of its nuclear program. This bill followed a year in which Iran's oil exports had already been cut in half by international sanctions. If countries don't import the target country's products, the target economy can face industry collapse and unemployment, which can put significant political pressure on the government.

A Military Threat Alternative
While countries have used sanctions to coerce or influence the trade policies of others for centuries, trade policy is rarely the sole strategy employed in foreign policy. It can be accompanied by both diplomatic and military actions. A sanction, however, might be a more attractive tool because it imposes an economic cost for a country's actions rather than a military one. Military conflicts are expensive, resource-intensive, cost lives and can illicit the ire of other nations due to the human suffering caused by the violence.

In addition, it is not feasible that a country can react to every political problem with military force: armies are simply not large enough. In fact, some problems are simply not well-suited for armed intervention. Sanctions are generally used when diplomatic efforts have failed.

Why Sanctions?
Sanctions may be enacted for several reasons, such as a retaliatory measure for another country's economic activities. For example, a steel-producing country might use a sanction if another country tries to protect a nascent steel industry by putting an import quota on foreign steel. Sanctions may also be used as a softer tool, especially as a deterrent to human rights abuses. The United Nations might condone the use of bilateral sanctions against a country if it perpetrates human rights abuses, or if it breaks resolutions regarding nuclear weapons.

Sometimes the threat of a sanction is enough to alter the target country's policies. A threat signals that a country does not approve of the target country's policies, and implies that the country issuing the threat is willing to go through economic hardship to punish the target country if change does not occur. The cost of the threat is less than military intervention, but it still carries economic weight. For example, in 2013 Zimbabwe's President Robert Mugabe and his inner circle were sanctioned by the U.S. because of alleged rights abuses.

The domestic politics of the country looking to use a sanction play a big role. International trade and international politics can take the back seat when nationalism comes into play, and a government can use a sanction as a way to demonstrate resolve or to create a distraction from domestic trouble. Because of this problem, international organizations such as the World Trade Organization (WTO) have been created to relieve some of the pressure and create arbitrary panels to objectively review disputes between countries. This is especially helpful, because sanctions can lead to economically damaging trade wars that can spill over into countries uninvolved in the original dispute.

The extent of economic suffering caused by a sanction and who feels it the most is often not immediately known. Research has shown that the severity of the economic impact on the target country increases as the level of international cooperation and coordination in its creation increases. It also will be more pronounced if the countries involved in the sanction previously had close relations, since trading ties are more likely to be significant if the countries have a rapport.

Impact of a Sanction
The immediate impact of an import sanction on the target country is that the country's exports are not purchased abroad. Depending on the target country's economic reliance on the exported good or service, this could have a crippling effect. The sanction might cause the sort of political and economic instability that results in a more totalitarian regime, or it can create a failed state due to a power vacuum. The target country's suffering is ultimately borne by its citizens, who in times of crisis may solidify the regime in charge rather than overthrow it. A crippled country can be a breeding ground for extremism, which is a scenario that the initiating country would probably prefer not to deal with.

Sanctions may follow the law of unintended consequences. For example, the Organization of Arab Petroleum-Exporting Countries (OAPEC) issued an embargo on oil shipments to the United States in 1973 as a punishment for re-supplying Israel with arms. OAPEC was using the embargo as a tool of foreign policy, but the effects spilled over and exacerbated the worldwide stock market crash of 1973-74. The inflow of capital from higher oil prices resulted in an arms race in Middle Eastern countries - a destabilizing problem - and did not result in the policy change envisioned by the OAPEC. In addition, many embargoed countries cut back on oil consumption and required more efficient use of petroleum products, further cutting demand.

Sanctions can increase costs to consumers and businesses in the countries that issue them, because the target country is unable to purchase goods, resulting in economic loss through unemployment and production loss. In addition, the issuing country will reduce the choice of goods and services that domestic consumers have, and may increase the cost of doing business for companies that must look elsewhere for supplies. If a sanction is made unilaterally, the effect of blocked imports or exports can be circumvented by the target country trading with third-party countries.

The Bottom Line
The success of sanctions varies in accordance with how many parties are involved. Bilateral sanctions are more effective than unilateral sanctions, but the success rate in general is fairly low. In many circumstances the sanctions caused economic harm without changing the target country's policies.

Sanctions are ultimately blunt tools of foreign policy, because their deployment is rarely precise enough to affect only the target economy, and because they presuppose that economic harm will lead to the sort of political pressure that will benefit the instigating country. By using a sanction, a country assumes that it is truly able to influence the leadership of the target country, a highly implausible assumption suggesting that other governments are pliable. Sanctions ultimately are a battle of political wills, with the loser being the country whose economy cannot withstand the pressure.

 

An Introduction to LIBOR

An Introduction to LIBOR

(Courtesy: Investopedia)

When most Americans think of British imports, their minds probably conjure up images of James Bond and Monty Python movies. These are all fine contributions, and with the success of the aforementioned British imports, it's hard to argue their significance, but quite possibly the most important import from England has a direct impact on the wallets of many Americans, especially homeowners. In this article we'll explain a little understood yet extremely relevant financial tool used across the globe: the London Interbank Offered Rate (LIBOR).

What Is LIBOR?
LIBOR is equivalent to the federal funds rate, or the interest rate one bank charges another for a loan. The advent of LIBOR can be traced to 1984, when the British Bankers Association (BBA) sought to add proper trading terms to actively traded markets, such as foreign currency, forward rate agreements and interest rate swaps. LIBOR rates were first used in financial markets in 1986 after test runs were conducted in the previous two years. Today, LIBOR has reached such stature that the rate is published daily by the BBA at about 11:45am GMT.

LIBOR's reach is felt thousands of miles away from the Thames; it is used as the key point of reference for financial instruments, such as futures contracts, the U.S. dollar, interest rate swaps and variable rate mortgages. LIBOR takes on added significance in times of tight credit as foreign banks yearn for U.S. dollars. This scenario usually sends LIBOR for dollars soaring, which is generally a sign of imminent economic peril.  

The Reach of LIBOR
LIBOR is set by 16 international member banks and, by some estimates, places rates on a staggering $360 trillion of financial products across the globe. Included in those products are adjustable rate mortgages (ARMs). In periods of stable interest rates, LIBOR ARMs can be attractive options for homebuyers. These mortgages have no negative amortization and, in many cases, offer fair rates for prepayment. The typical ARM is indexed to the six-month LIBOR rate plus 2-3%.  

LIBOR's reach doesn't end with the homeowner. The rate is also used to calculate rates for small business loans, student loans and credit cards. More often than not, LIBOR's heavy hand isn't felt directly by homeowners or others in need of a loan. When the U.S. interest rate environment is stable and the economy flourishes, all is usually well with LIBOR. Unfortunately, there is another side to that coin. During times of economic uncertainty, especially in developed countries, LIBOR rates show signs of excessive volatility, making it harder for banks to make and receive loans among each other. That problem is passed down to people seeking loans from the bank. If cash is scarce or at a premium for your local bank, the bank simply charges you, the borrower, a higher interest rate, or worse, doesn't loan you the money at all.

If Times Are Bad, Watch LIBOR
Another prominent trait of LIBOR is that it can dilute the effects of Fed rate cuts. Most investors think it's great when the Fed cuts rates, or at least they welcome the news. If LIBOR rates are high, the Fed cuts look a lot like taking a vacation to Hawaii and getting rain every day. High LIBOR rates restrict people from getting loans, making a lower Fed discount rate a non-event for the average person. If you have a subprime mortgage, you need to watch LIBOR rates with a close eye as almost $1 trillion in subprime ARMs are indexed to LIBOR.  

While LIBOR action in relation to the foreign exchange markets pertains more to currencies, such as the euro, the British pound, the Japanese yen, and others, its daily impact on the value of the dollars spent in the United States is negligible, though it is worth noting that LIBOR is very relevant to rates on the euro, or U.S. dollars held by foreign banks. The euro accounts for roughly 20% of total dollar reserves.

Bottom Line
LIBOR isn't sexy, and it's doubtful anyone is looking forward to the next release of LIBOR data with the same anticipation of seeing the next James Bond movie. That said, anyone with a credit card or a desire to own a home needs to be of aware of LIBOR. LIBOR is the true British monarchy, at least for the global financial markets - and your personal bottom line. 

Opening Bank Account Made Easy

Now, open a bank account through Aadhaar without paperwork

 

The Unique Identification Authority of India (UIDAI) has enabled a feature that would allow anyone with an Aadhaar number to open a bank account, without any paperwork.

Axis Bank was the first lender to start the electronic know-your-customer (e-KYC) facility, which would facilitate Aadhaar-registered individuals to step into a branch and open an account, merely by providing his/her unique identification number, after which the person's fingerprints would be scanned.

On Thursday, UIDAI chief Nandan Nilekani launched the e-KYC facility at the Axis Bank headquarters here. Initially, the facility is available at 1,000 branches of the bank. By the end of this month, Axis Bank would extend the facility to about 2,000 branches.

Nilekani parried questions on extending the facility to other banks. He said the idea was to expand the e-KYC facility, adding it was possible to secure insurance cover and apply for mutual funds through this. Talks are on to include pension schemes in the programme, too.

Axis Bank would connect with UIDAI through an authorised service agent-usually, a payment gateway-which would, in turn, connect with the UIDAI database, Nilekani said.

Shikha Sharma, managing director and chief executive of Axis Bank, said while opening bank accounts, a key challenge for customers was providing proof of address and identity, as well as physical copies of documents. She added e-KYC simplified this process and provided better customer experience.

The facility was safer compared to the current practice of providing photocopies of documents, Nilekani said, adding all work happened electronically, at the back-end. "Fundamentally, all the infrastructure is falling into place for creating a much more electronic, a much more digital-cash kind of an economy," he said, adding this had long-term ramifications, including making the economy cashless.

So far, UIDAI, set up four years ago, has rolled out 460 million Aadhaar numbers. It was targeting 600 million numbers (half the country's population) by early next year, Nilekani said.

 

Vocabulary Test

                Vocabulary Test (Contains 10 questions and each questions contains 4 options)

1.       deity               n. a god               n. a ludicrous and complete failure               adj. extravagantly romantic or idealistic; highly impractical               n. evenness of temper or mind 2.       protuberant                n. a superficial appearance or show designed to impress one with superiority.                n. one who advocates extreme basic changes                adj. profuse or generous; given to extravagance                adj. bulging or swelling out 3.       retrieve               v. to make good; to recover               adj. sentimental to the point of tears               adj. entertaining               adj. inclined, through some whim or fancy change the mind, purpose, or actions  suddenly 4.       dearth               n. scarcity               v. to punish or criticize severely               v. to cause, produce, or stir up               adj. habitually fond of associating in a company or herd 5.       integrity               n. honesty, moral soundness               adj. liable to make mistakes or be deceived               adj. possessing similar interests and tastes; able to get on well with others               adj. very heavy; clumsy 6.       delete               n. an increase               n. an original pattern               n. working together secretly for an evil purpose               v. to erase or cancel, take out or remove 7.       demagogue               n. departure, emigration               adj. worldly, as opposed to spiritual; existing for a time only              n. a leader who tries to stir the passions of people for his own purposes              n. prolonged duration of life 8.       mettle               adj. sentimental to the point of tears               n. a persistent feeling, idea, activity, etc., which dominates a person; the state of being exclusively preoccupied by a fixed idea              v. to be sorry for              n. disposition; spirit 9.       predatory               adj. inclined to plunder or rob; preying on, others               n. an assumption made for the sake of argument               n. confused, unintelligible, meaningless talk; special vocabulary used only by members of a group or trade              adj. outstandingly bad 10.   dissent               n. partiality or preference for; a favorable opinion arrived at beforehand               v. to disagree; to differ in opinion               v. to banish or exile; to withdraw from one's country               n. a relation between two things shown in the resemblance not of the things themselves but of their characteristics

Answers:

1. n. a god

2. adj. bulging or swelling out 

3. v. to make good; to recover

4. n. scarcity 

5. n. honesty, moral soundness 

6. v. to erase or cancel, take out or remove

7. n. a leader who tries to stir the passions of people for his own purposes

8. n. disposition; spirit

9. adj. inclined to plunder or rob; preying on others

10. v. to disagree; to differ in opinion