A firm's Cost of capital is the cost it must pay to raise funds—either by selling bonds, borrowing, or equity financing. A question associated with the saving component of financial planning is: A. 7. Financing of Constructed Facilities 7.1 The Financing Problem. Steve Wilson wants to deposit $150 per month into an account earning 4 percent for the next 3 years, so he can purchase a used car at that time. C) Simple interest E) Maintaining control over credit-buying habits The required return on the stock market is 10.00%, and the risk-free rate is 2.25%. C) none of these answers are correct. When prices are increasing at a rate of 6 percent, the cost of products would double in about 12 years. 219,295 students got unstuck by CourseHero in the last week, Our Expert Tutors provide step by step solutions to help you excel in your courses. The major function of personal financial planning is to Personal financial planning is the process of managing your money to achieve personal economic satisfaction. 2. Acquiring adequate insurance coverage B. The rising or falling of prices that causes changes in buying power is referred to as ____________ risk. Whi, The Comic Book Publication Group (CBPG) specializes in creating, illustrating, writing, and printing various publications. His credit rating is poor because of his late payments. A) Present value of a single amount Goals are what allow you to practice delayed gratification. E) Obtain adequate insurance protection. C) income 10. C) Achieve personal economic satisfaction. The cost of debt is the rate a company pays on its debt, such as bonds and loans. If you’re a current or future college student, chances are good that you’re considering a student loan. B) inflation B) only assets reported on the balance sheet of the employer as prepaid pension cost. E) Minimizing transportation expenses through careful planning B) False They can also be used as a tool to plan for certain results. C) Equal to the inflation rate as reported by the CPI since it includes all products and services whether or not the prices have changed in the past 12 months D) Obtaining financial resources from employment, investments or ownership Study Chapter 1: Personal Financial Planning in Action Flashcards … Answer: Even when conditions are changing rapidly and in ways that are difficult to foresee, the process of financial planning forces managers to think carefully about the future. Financial accounting represents just one sector in the field of business accounting. A) Obtaining The average yield on AAA bonds is ​5%, on A bonds ​6%, and on, A company is considering a new product launch. The strategic plan provides the broader context for short and long-term financial plans. Educators work to include a wide array of studies within the required curriculum for young adults. Which of the following short-term goals is stated most clearly? Let us help you with your finance homework! If you want to make headway financially you need goals that are strong enough to inspire you to action. A formalized report that summarizes your current financial situation, analyzes your financial needs, and recommends a direction for your financial activities is a(n), The major function of a financial plan is to. A. B) $889 She thinks that she will need a total of $32,000 to pay for school, and she wants to save money each month to reach her goal. Which of the following would increase the interest rate for a loan? He wants to buy a new car but was told that his interest rate on a loan would be very high. Retirement planning includes thinking about your housing situation, recreational activities, and possible volunteer or part-time work. It is also known as the Statement of Financial Position or Statement of Financial Condition or Position Statement. (p. 7-8) The ‘borrowing' activity in a financial plan relates to A. Attempts to increase income through employment are part of the _____________ component of financial planning. Developing a budget is part of the "spending" component of financial planning. He usually makes minimum payments on his debt and he has been late with three payments in the last year. 5. Higher consumer prices are likely to be accompanied by, An investor should expect to receive a risk premium for, C. Higher potential earnings due to uncertainty. The life situation of a household has little influence on personal financial planning decisions. Investment in a constructed facility represents a cost in the short term that returns benefits only over the long term use of the facility. 6. 1. B) 10 percent D) Present value of an annuity Projected benefit obligation (beginning of year) 2,400,000 3. Sally Smith's friends have told her that they think she should consider a visit to a personal financial planner. Financial ratios are relationships determined from a company's financial information and used for comparison purposes. Another sector, managerial accounting, is so named because it provides financial information to a company's management.This information is generally internal (not distributed outside of the company) and is primarily used by management to make decisions. The problem of bankruptcy is associated with poor decisions in the ______________ component of financial planning. adequate insurance coverage STUDENT LEARNING PLAN Lesson 2-1: Using Credit ©2014 National Endowment for Financial Education www.hsfpp.org Lesson 2-1: Using Credit High School Financial Planning Program June 2014 OVERVIEW Credit cards, auto loans, home mortgages, pawn shops … you’ve probably heard a lot about debt over the years—good and bad. Financial Accounting vs. "Other" Accounting. 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