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Q5. Give the introduction of leasing with an example. Explain all the
four types of leasing.
Answer. Leasing is a process by which a firm can obtain the use of a certain
fixed assets for which it must pay a series of contractual, periodic, tax
deductible payments.
The lessee is the receiver of the services or the assets under the lease contract
and the lessor is the owner of the assets. The relationship between the tenant
and the landlord is called a tenancy, and can be for a fixed or an indefinite
period of time (called the term of the lease). The consideration for the lease is
called rent. A gross lease is when the tenant pays a flat rental
Winter-2015
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Q6. Write about the concept of securitization and its features. Explain
the process of securitization of debts and its advantages.
Answer. Securitization is the process of taking an illiquid asset, or group of
assets, and through financial engineering, transforming them into a security.
The process through which an issuer creates a financial instrument by
combining other financial assets and then marketing different tiers of the
repackaged instruments to investors. The process can encompass any type of
financial asset and promotes liquidity in the marketplace.