This statement is true.
In Causal forecasting, one tries to base the model on the causes of a particular behavior. These causes are the independent variables.
Forecasting is a method of making informed predictions by using historical data as the primary input for determining future trends. Businesses use forecasts for a variety of purposes. B. To forecast future costs and determine how to allocate budgets.
Causal forecasting is a strategy that predicts or attempts to forecast future events in a market based on a number of variables that are likely to influence future movements within the market.
Based on variables that influence data availability and states of interest, the branches of random methods are segmentation, index methods, and regression analysis. Regression analysis is the most common computable method of random prediction.
Learn more about causal forecasting here
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Answer:
2. Interest income will drop by less than $3 million for a sudden 1% drop in market interest rates
Explanation:
Since in the question it is mentioned that there is decrease in 2021 interest income of $3 million in the case when there is a sudden decline of 1% in the rate of interest of the market this is due to the convexity of the curve as the GAP analysis and assume straight line
So the option 2 is correct
Answer:
$65,076,885.59
Explanation:
We use the Present value formula that is shown in the spreadsheet attachment
Given that,
Future value = $0
Rate of interest = 6.5%
NPER = 10 years
PMT = $85,000,000 ÷ 10 annual payments = $8,500,000
The formula is shown below:
= -PV(Rate;NPER;PMT;FV;type)
So, after solving this, the present value is $65,076,885.59
Answer:
NPV= $22,511.15
Explanation:
<u>First, we need to calculate the present value of the cash flows ∑[Cf/(1+i)^n]:</u>
FV= {A*[(1+i)^n-1]}/i
A= annual cash flow
FV= {50,000*[(1.12^10) - 1]} / 0.12
FV= $877,436.75
PV= FV/(1+i)^n
PV= 877,436.75/1.12^10
PV= $282,511.15
<u>Now, the net present value, using the following formula:</u>
NPV= -Io + ∑[Cf/(1+i)^n]
NPV= -260,000 + 282,511.15
NPV= $22,511.15
Answer:
The correct answer is measures economic activity and income.
Explanation:
Real GDP is the economic measure to determine the total production of goods and services produced by a country at constant prices. This means that this indicator does not take into account price changes over time (inflation), which differs from nominal GDP, which does consider the value of money in a given period of time.