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Financial Forecasting Basics Test
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Financial Forecasting Basics Test
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25 Questions

1. Which of the following helps create a financial model?
2. The time series method:
3. True or False? Forecasting is based on historical information and assumptions.
4. What are the two overarching financial forecasting approaches?
5. True or False? A black swan is an example of an internality.
6. Which of the following items is NOT likely found on a capital budget?
7. True or False? Bayes theorem is often used in financial forecasting.
8. Financial forecasting is used for:
9. True or False? Quantitative models typically use experts opinions to form future trends.
10. Which of the following balance sheet items is NOT likely to vary directly with changes in revenue?
11. Companies with lower PEG ratios typically:
12. Which of the following are important characteristics when identifying peer companies to use in firm valuation?
13. Projected financial statements are called:
14. Which type of security is used as a measurement of a low risk rate?
15. The primary purpose of a cash budget is:
16. A company-™s Sustainable Rate of Growth (SRG) is determined by which of the following:
17. What does DCF stand for?
18. Which of the following could be used in financial forecasts?
19. True or False? Bayes theorem does not use balance sheets to make predictions.
20. What is the discount rate often used in capital budgeting that makes the Net Present Value (NVP) of all cash flows from a particular project equal to zero:
21. Before they are updated
22. What does the x-axis of the security market line measure?
23. True or False? Verification is the process of comparing actual results and predicted results.
24. Which of the following is not included under the qualitative forecasting method?
25. True or False? Use of historical data is irrelevant to a financial forcast.