IGCSE Development Studies: Specimen Questions with Answers 48 - 49 of 98

Explanation

Debt relief is the partial or total relief from debts especially to those developing countries who owe debt to external creditors. By definition “it is the reorganization of debt in any form with the aim of providing relief either partial or in full from a financial burden.” Debt relief will only be considered by the creditors if there is no other better alternative than the relief of debt

• Debt relief helps companies to invest money into development projects such as industry.
• Through debt relief some of the countries have used this opportunity of saving money in improving the quality of life of the people.

Explanation

Joint ventures: Joint venture reefers to the co-operation of two or more individuals or business in which each agrees to share profit and loss and control in a specific enterprise. It is usually a temporary partnership without the use of a firm name. It limited to the specific purpose for which the persons agree to contribute capital and share losses. The liability of the partners is limited to the venture concerned for which they agree to contribute capital and share profit and losses.

Features of Joint Venture Are

• Agreement between two or more persons.
• Joint venture is made for the specific execution of a project or task. Thus, the going concern concept of accountancy is not applicable to a joint venture.
• Agreement for joint venture is dissolved as soon as the specific project is over.
• The profit and loss of joint venture is computed on completion of the venture.