ACC 345 Harriet Creyer 4-2 Assignment- Economic Indicators and Valuation Discounts and Methods
.docx
keyboard_arrow_up
School
Southern New Hampshire University *
*We aren’t endorsed by this school
Course
34
Subject
Economics
Date
Nov 24, 2024
Type
docx
Pages
9
Uploaded by Barbara8289
1
Economic Indicators and Valuation Discounts and Methods
Harriet Creyer
4-2 Assignment: Economic Indicators and Valuation Discounts and Methods
Southern New Hampshire University
ACC 34 Financial Statement Analysis/Business Valuation
2
Economic Indicators and Valuation Discounts and Methods
Economic Indicators
Explain what economic indicators are and why they are important to a company.
Economic indicators are measurements that tell us information about the state or functioning of an economy in a nation or region. They are taken from information such as production and inventory data, inflation rates, consumer expenditure, and employment statistics. Economic indicators are used by businesses to understand their current operating market conditions and general economy, (Indeed Editorial Team,
Understanding Economics
2022)
. A corporation might utilize three sorts of economic indicators, namely leading, lagging, and coincident indicators to spot trends, opportunities, and dangers, and analyze its business processes, and retool them as needed to remain competitive. Changes in economic indicators can be produced by monetary policy modifications and trade conflicts; their implications vary, including lower demand for goods and increased importation prices.
Identify three types of economic indicators that a company might use to inform its business decisions.
Leading indicators, lagging indicators, and coincident indicators are the three categories of economic indicators used by businesses. Leading indicators offer insight into upcoming economic performance or changes and shift or any possible market problems. Lagging indicators offer an idea into historical changes by tracking the performance of the economy overall or in particular industries. GDP, corporate profits, and unemployment rates are a few examples of lagging indicators. Coincident indicators follow the general economic
3
Economic Indicators and Valuation Discounts and Methods
trend and are used to evaluate the state of the economy. These could include personal income,
employment rates, and industrial production. (Dan,
Economic indicators
2013)
Explain how a company might make business decisions based on its knowledge of economic indicators.
By analysing the trends and patterns of these indicators, businesses can use their understanding and knowledge of economic indicators to make their decisions. For instance, if
a business notices that consumer confidence is dipping, it might decide to cut back on production and inventory because there may be a drop in demand for its goods. Similarly, to this, a business can decide to implement a hiring freeze rather than increase its workforce if it
notices rising unemployment rates. By analyzing the economic climate, organizations may also anticipate regulatory changes and make necessary improvements that can benefit their business.
Explain any significant changes that have affected economic indicators over the past three to five years. Include the following detail in your response:
Explain what you think caused the changes to occur.
Over the previous three to five years, numerous economic factors have seen considerable changes owing to various circumstances. The global decline in interest rates is one illustration of a substantial development. In several nations, interest rates have fallen sharply in an effort to spur economic expansion and lower inflation. Indicators of the economy can also change as a result of geopolitical unrest or interruptions in global commerce, as was the case with Brexit.
4
Economic Indicators and Valuation Discounts and Methods
Explain the impact the changes to the economic indicators have had on both domestic and global economies.
The impact of changes in economic indicators differs in various nations or areas, with both positive and negative effects. For example, a drop in interest rates may encourage investing, borrowing, and spending, which would increase economic growth. Yet, this fall in interest rates might also start inflation and a corresponding decline in investments. Explain how a company should respond to changes related to domestic and global economies to remain in business and competitive.
For a company to stay competitive and adaptable, businesses should act quickly in response to changes in the national and international economies. One way is to determine the most crucial economic indicators relevant to their sector and monitor them often to predict changes. This can help organizations plan effectively for declining demand or increasing costs of inputs. They should also be examining company strategies and their operation on a regular basis to try to increase efficiency and cut expenses. By implementing strategies to respond to changes in economic indicators, companies can improve market opportunities, mitigate risks, and maintain profitability. Valuation Discounts
Explain the discount for lack of control (DLOC) and when it is used in the valuation process.
The Discount for Lack of Control (DLOC) is applied when valuing a minority interest
in a business. It accounts for the potential loss of decision-making power and the limited ability to influence or direct company operations as a minority shareholder. DLOC varies
Your preview ends here
Eager to read complete document? Join bartleby learn and gain access to the full version
- Access to all documents
- Unlimited textbook solutions
- 24/7 expert homework help
Related Questions
Principles of Macroeconomics "T1301102"
Student name:
First Exam- PART2, 13/0372021
St #
Question
(20
points)
Refer to the table below, answer the questions that follow:
Personal consumption expenditures
Government purchases-
Net private domestic investment
Exports
Imports
Depreciation
Receipts of factor income from the rest of the world
Payments of factor income to the rest of the world
600
100
200
50
-60
40
30
50
1 The value for GDP is
2. The value for GNPIS
3. The value for NNP is
4. The value of NI is
(30 points)
Question 2
A- Discuss therelationship between ourput, unemployment, & inflation.
arrow_forward
12
Analyze the challenges of 21st century global leaders in business
arrow_forward
Resources
Submit All
Question 3 of 30
Stacy and Miguel are preparing to open a burger joint called "Stacy and Miguel's Burgers and More Burgers." They are still
unclear about the various types of business organizations. Answer the questions to clarify the differences between
business organizations.
Which business organization can raise capital by issuing stock?
sole proprietorship
corporation
O partnership
Which business organization typically has a single owner that has unlimited liability?
partnership
sole proprietorship
&13 PM
46°F
12/15/2021
a
arrow_forward
quarter and years
Quarter1
2015
Quarter2 Quarter3|Quarter4 Quarter1 Quarter2 Quarter3 Quarter4 Quarter1 Quarter2 Quarter3 Quarter4
2015
Unit
2015
2015
2016
2016
2016
2016
2017
2017
2017
Description
$ million
Data Category and Component
2017
27.748
27.938
31.873
30.435
26.157
25.806
29.337
27.748
27.938
31.873
30.435
Agriculture
$ milion
32.141
29.598
28.073
31.514
33.489
33.727
32.686
32.141
29.598
28.073
31.514
Mining and Quarrying
Manufacturing
$ milion
70.892
74.946
76.020
77.940
73.899
77.680
79.324
70.892
74.946
76.020
77.940
$ milion
7.522
7.977
8.095
8.116
7.903
8.318
8.621
8.641
8.315
8.738
9.115
9.208
Blectricity, Gas and Water
$ million
16.659
16.041
17.179
16.673
17.655
16.971
18.166
16.659
16.041
17.179
16.673
Construction
Wholesale and Retal Trade,
Accommodation and Restaurants
$ mion
51.264
51.984
56.305
60.687
55.180
56.232
60.976
65.920
60.720
62.578
67.437
72.322
Transport, Storage and
Communication
$ milion
25.163
25.772
26.539
26.887
27.287
28.059
28.593
29.026…
arrow_forward
Economic Actions undertaken by agreement between institutional units are called1. Economic Flows Contracts2. Contracts between parties 3. Transactions4. Voluntary Transfers5. Economic Value
arrow_forward
ladependent Activity 1. What kind of Research?
Directions: Based on the given research topics below you're going to decide what kind of
quantitative research would you use to investigate these problems. Briefly
discuss your answers.
...
1. Connection between one's gender and academic performance
2. Effects of vermicast to the growth and yield performance of leafy vegetable plants
3. Impacts of African Swine Fever to pork vendors in Bulacan
4. Relationship of English proficiency to academic performance in mathematics
5. Attitude and opinion of high school students towards academic cheating
arrow_forward
S1: The most relevant advantage of locating a firm in an Industrial District is knowledge spillover. S2: The K -12 Program added years to basic education but Philippines student learning still lags behind many of East Asian countries.
A. True, True
B. True, False
C. False, True
D. False, False
arrow_forward
4:03
⚫ ccdc.instructure.com
What does a vision provide to an
organization?
directional- shows the direction
of the company
focused-specific and can be
implemented
ease of communication-
comprehensible in 5 - 10
minutes
all of these answers are correct
Question 4
2 pts
One concern with the growth of
corporations in the past 20 years
is that corporations do not...
pay taxes
consider their impact on the
communities they employ and
act in
○ employ enough people overseas
from where they are owned
all of these answers are correct
arrow_forward
Please provide a summary of these key points
arrow_forward
you are required to prepare:
1: state incline or decline for each sector above (services, manufacturing, agriculture, mining and construction)
2: Give at least 3 examples of industries for each sector
3: Give reasons why increasing / decreasing growth for each sector (relate with pandemic)
arrow_forward
4. Outline the elements of the digital business environment for an
organization and
explain its relevance to the organization.
arrow_forward
Based on these indicators, do you think Iloilo City is a global city or not? Answer in not less than 7 sentences and not more than 10 sentences. Be sure to support your answer with concrete examples.
arrow_forward
Part 1: Analytical Thinking - Analysis of Digital Data Instructions: Below is a hypothetical dataset on the performance of two digital projects, "Project A" and "Project B," at Latinex over the last five years. Analyze the data and provide conclusions and recommendations based on your analysis. Year 2023 2022 2021 2020 2019 Proyect A (Active Proyect B (Active users) users) 8,000 10,000 6,500 9,000 8,000 7,000 6,000 5,000 4,200 3,500 Which of the two projects has experienced greater growth in terms of active users? Are there any clear trends in the data that may be relevant for the development of future digital projects? 0 / 250
arrow_forward
urgent
arrow_forward
Term Project 2
State of the Economy
This table shows Zambia economic indicators from 1991-2021 time period. All variables are
measured in percent.
Year
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
GDP growth (annual %)
-0.04
-1.73
6.80
-8.63
2.90
6.22
3.81
-0.39
4.65
3.90
5.32
4.51
6.94
7.03
7.24
7.90
8.35
7.77
9.22
10.30
5.56
7.60
5.06
4.70
2.92
3.78
3.50
4.03
1.44
-2.79
Inflation, consumer
prices (annual %)
97.64
165.71
183.31
54.60
34.93
43.07
24.42
24.46
26.79
26.03
21.39
22.23
21.40
17.97
18.32
9.02
10.66
12.45
13.40
8.50
6.43
6.58
6.98
7.81
10.11
17.87
6.58
7.49
9.15
15.73
Unemployment, total (%
of total labor force)
18.90
19.26
19.70
18.22
16.72
15.30
13.59
12.00
12.50
12.93
13.50
14.18
14.80
15.37
15.90
12.87
10.20
7.93
10.50
13.19
10.34
7.85
8.61
9.34
10.10
10.88
11.63
12.01
11.91
12.17
Q1. How would you characterize the state of the economy over this time period and…
arrow_forward
13. Use the table below to answer the question.
Gross Domestic Product Per Capita (GDP) Years in SchoolLiteracy
in U.S. Dollars
Country
Rate
(Primary to
Tertiary)
Brazil
14 years
88.6%
$10,800
(2010 estimate)
India
10 years
61%
$3,500
(2010 estimate)
United
16 years
99%
$34,800
(2010 estimate)
Kingdom
Which statement best explains the information in this table?
arrow_forward
1. 3 importance of globalization in terms of people/population
2. 3 importance of globalization in terms of education
3. 3 importance of globalization in terms of certain country
arrow_forward
Part 2 question:
Imagine you are one of the few highly skilled workers in a less developed country. Your country has been increasingly participated in Global Value Chains (GVCs) in the past decades. Is your country’s increasing involvement in GVCs is a good thing for you? Explain why. [Note: assume that you are primarily concerned about your wages, and you have no intention to migrate to other countries].
arrow_forward
2.1 A recession had been typically defined as two consecutive quarters of negative growth in real Gross Domestic Product (GDP).
(a) Based on the above definition for recession, identify the last two recessions in Australia. In addition, research and provide data on the following economic indicators in these last two recessions.
(i) GDP quarterly performance
(ii) GDP components (Consumption, Investment, Government Spending and Net Trade)
(iii) Unemployment rate
(iv) Inflation rate
(b) Clearly identify the cause(s) of each of these two recessions in Australia.
Please use diagrams to explain and write briefly
arrow_forward
Question 1 (AV7.1)
You have been employed as the chief economist for the economy SKL Land. The head statistician has provided you with the following information:
Compensation of Employees 900
Consumption of goods 850
Corporate profits 400
Rent Income 125
Factor income paid to the world 325
Consumption of services 475
Factor Income received from the world 170
Residential investments 350
Indirect taxes 775
Non-residential investments 525
Subsidies 125
Government Expenditure 925
Depreciation 120
Imports 700
Net interest 75
Exports 300
Proprietors income 300
Calculate SKL Land’s GDP using (1) the Income and (2) the Expenditure Approach
arrow_forward
Description
Background information: A worker in the United States and a worker in China can each produce 1,000 pairs of jeans per week. A worker in the United States can produce 50 cell phones in a week, and a worker in China can produce 100 cell phones in a week. Answer the following questions based on this information. Part A: If each country attempted to produce both jeans and cell phones, how many jeans and cell phones could each country produce? What would be the total number of jeans and cell phones produced by the two countries combined? Show your work.in detail Part B: Calculate the opportunity cost of producing jeans for each country. Show your work in detail Part C: Calculate the opportunity cost of producing cell phones for each country. Show your work in detail Part D: Determine how many jeans should be produced by each nation. Show your work in detail. Part E: If each nation should specialize in producing jeans and cell phones, explain why; use economic terminology in your…
arrow_forward
3. Michael Porter’s Diamond Model comprises FOUR major elements. With the use of examples, briefly describe ANY TWO elements of Michael Porter’s Diamond Model.
A complete answer will explain each factor and utilize an example from either the local or international business environment.
arrow_forward
10) Which of the following statements is true about sole proprietorships?
A) Sole proprietorships are the least common form of business organization in the
10)
United States.
B) Most sole proprietorships have limited liability for their debts.
C) Most sole proprietorships focus on services rather than on the manufacturing of
goods.
D) Sole proprietorships net far more sales and income than corporations.
E) Sole proprietorships are typically small businesses employing fewer than 100
people.
arrow_forward
Based on the charts consulted, comment what is expected from the American economy in the next years in general terms.
Are there differences in the forecasts?
How do you think the state will act in the future based on the chart variables that inform us about its behavior?
What will the behavior of families and companies be like?
Using these graphs provided, Answer the questions in an essay format, comparing the two.
Source: J.P. Morgan Asset Management; (Top left) Census Bureau, DOD, DOJ; (Top left and right) BLS; (Right and bottom left) BEA. GDP drivers are calculated as the average annualized growth in the 10 years ending in the fourth quarter of each decade. *The latest period reflects 1Q20 to 3Q23. Future working-age population is calculated as the total estimated number of Americans from the Census Bureau, per the November 2023 report, controlled for military enrollment, growth in institutionalized population and demographic trends. Growth in working-age population does not…
arrow_forward
Activity 1
Answer the following:
1. Would you consider spending to make a school or an office building earthquake-proof a
good investment? Why?
2. Assuming that the country like the Philippines can afford it, what proportion of its
annual budget should it allocate for disaster-related programs?
3. What would you consider a better policy, focusing on preparedness and other pre-
disaster programs or on post-disaster-related concerns (relief, rescue, and
rehabilitation)? Explain your answer.
arrow_forward
SEE MORE QUESTIONS
Recommended textbooks for you
Principles of Economics 2e
Economics
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:OpenStax
Economics Today and Tomorrow, Student Edition
Economics
ISBN:9780078747663
Author:McGraw-Hill
Publisher:Glencoe/McGraw-Hill School Pub Co
Related Questions
- Principles of Macroeconomics "T1301102" Student name: First Exam- PART2, 13/0372021 St # Question (20 points) Refer to the table below, answer the questions that follow: Personal consumption expenditures Government purchases- Net private domestic investment Exports Imports Depreciation Receipts of factor income from the rest of the world Payments of factor income to the rest of the world 600 100 200 50 -60 40 30 50 1 The value for GDP is 2. The value for GNPIS 3. The value for NNP is 4. The value of NI is (30 points) Question 2 A- Discuss therelationship between ourput, unemployment, & inflation.arrow_forward12 Analyze the challenges of 21st century global leaders in businessarrow_forwardResources Submit All Question 3 of 30 Stacy and Miguel are preparing to open a burger joint called "Stacy and Miguel's Burgers and More Burgers." They are still unclear about the various types of business organizations. Answer the questions to clarify the differences between business organizations. Which business organization can raise capital by issuing stock? sole proprietorship corporation O partnership Which business organization typically has a single owner that has unlimited liability? partnership sole proprietorship &13 PM 46°F 12/15/2021 aarrow_forward
- quarter and years Quarter1 2015 Quarter2 Quarter3|Quarter4 Quarter1 Quarter2 Quarter3 Quarter4 Quarter1 Quarter2 Quarter3 Quarter4 2015 Unit 2015 2015 2016 2016 2016 2016 2017 2017 2017 Description $ million Data Category and Component 2017 27.748 27.938 31.873 30.435 26.157 25.806 29.337 27.748 27.938 31.873 30.435 Agriculture $ milion 32.141 29.598 28.073 31.514 33.489 33.727 32.686 32.141 29.598 28.073 31.514 Mining and Quarrying Manufacturing $ milion 70.892 74.946 76.020 77.940 73.899 77.680 79.324 70.892 74.946 76.020 77.940 $ milion 7.522 7.977 8.095 8.116 7.903 8.318 8.621 8.641 8.315 8.738 9.115 9.208 Blectricity, Gas and Water $ million 16.659 16.041 17.179 16.673 17.655 16.971 18.166 16.659 16.041 17.179 16.673 Construction Wholesale and Retal Trade, Accommodation and Restaurants $ mion 51.264 51.984 56.305 60.687 55.180 56.232 60.976 65.920 60.720 62.578 67.437 72.322 Transport, Storage and Communication $ milion 25.163 25.772 26.539 26.887 27.287 28.059 28.593 29.026…arrow_forwardEconomic Actions undertaken by agreement between institutional units are called1. Economic Flows Contracts2. Contracts between parties 3. Transactions4. Voluntary Transfers5. Economic Valuearrow_forwardladependent Activity 1. What kind of Research? Directions: Based on the given research topics below you're going to decide what kind of quantitative research would you use to investigate these problems. Briefly discuss your answers. ... 1. Connection between one's gender and academic performance 2. Effects of vermicast to the growth and yield performance of leafy vegetable plants 3. Impacts of African Swine Fever to pork vendors in Bulacan 4. Relationship of English proficiency to academic performance in mathematics 5. Attitude and opinion of high school students towards academic cheatingarrow_forward
- S1: The most relevant advantage of locating a firm in an Industrial District is knowledge spillover. S2: The K -12 Program added years to basic education but Philippines student learning still lags behind many of East Asian countries. A. True, True B. True, False C. False, True D. False, Falsearrow_forward4:03 ⚫ ccdc.instructure.com What does a vision provide to an organization? directional- shows the direction of the company focused-specific and can be implemented ease of communication- comprehensible in 5 - 10 minutes all of these answers are correct Question 4 2 pts One concern with the growth of corporations in the past 20 years is that corporations do not... pay taxes consider their impact on the communities they employ and act in ○ employ enough people overseas from where they are owned all of these answers are correctarrow_forwardPlease provide a summary of these key pointsarrow_forward
- you are required to prepare: 1: state incline or decline for each sector above (services, manufacturing, agriculture, mining and construction) 2: Give at least 3 examples of industries for each sector 3: Give reasons why increasing / decreasing growth for each sector (relate with pandemic)arrow_forward4. Outline the elements of the digital business environment for an organization and explain its relevance to the organization.arrow_forwardBased on these indicators, do you think Iloilo City is a global city or not? Answer in not less than 7 sentences and not more than 10 sentences. Be sure to support your answer with concrete examples.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Principles of Economics 2eEconomicsISBN:9781947172364Author:Steven A. Greenlaw; David ShapiroPublisher:OpenStaxEconomics Today and Tomorrow, Student EditionEconomicsISBN:9780078747663Author:McGraw-HillPublisher:Glencoe/McGraw-Hill School Pub Co
Principles of Economics 2e
Economics
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:OpenStax
Economics Today and Tomorrow, Student Edition
Economics
ISBN:9780078747663
Author:McGraw-Hill
Publisher:Glencoe/McGraw-Hill School Pub Co