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Financial Literacy For Managers Essay

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Added on  2020-07-23

Financial Literacy For Managers Essay

   Added on 2020-07-23

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FINANCIAL LITERACYFOR MANAGERS
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Table of ContentsINTRODUCTION...........................................................................................................................11. USES OF BUSINESS ECONOMIC CONCEPT........................................................................1a).............................................................................................................................................1b).............................................................................................................................................2c).............................................................................................................................................22. ACCOUNTING AND FINANCE CONCEPTS..........................................................................3QUESTION 3 ..................................................................................................................................5(a) Calculation of loan amortization schedule........................................................................5Question 3(c) Calculation of Net Present Value (NPV).........................................................8CONCLUSION..............................................................................................................................10REFERENCES..............................................................................................................................11APPENDIX....................................................................................................................................12
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Illustration IndexIllustration 1: Income statement for analysing financial position of entity.....................................4Illustration 2: IRR for decision making...........................................................................................5Illustration 3: Principle interest ratio...............................................................................................6Index of TablesTable 1: Loan Amortization Schedule.............................................................................................5Table 2: Future Value Calculation...................................................................................................7Table 3: NPV of Project A...............................................................................................................8Table 4: NPV of Project B...............................................................................................................8
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INTRODUCTIONFinancial and Economic Literacy is an ability to use the economic concept to makeeffective decision related to earning, saving and spending of money. The present reportdescribes the principles of business and financial economics in international context. It alsoexplains the impact of government monetary policy while making declension related of earnings.Furthermore, it describes the concept of micro and macro model and interpreting the financialinformation which is essential for making effective decision. At last, it also examines therelationship between theory, application which is related to the business and financial economicsare presented in the report.1. USES OF BUSINESS ECONOMIC CONCEPTa)Globalisation: It includes various kind of general information such as cutting thenational boundaries, higher integration or independence of human societies etc. Globalisationplays an important role in creation of employment in UK. If one company make a businessapproach outside than it will make both positive and negative impact in process of employment.Many companies hire temporary workers because market liberalization policies are changingfrequently. Firm also want growth by segmenting them into new market. Globalization isimportant for improving the standard level of bhusiness (Borio, 2014). In respect to this,organisation need to hire those workers who frequently adopt the new changes in their workingplace. Hence, company hire temporary workers who can work easily and switch into new field.As per the research, there are many companies in UK which hire temporary workers. As a result,the rate of hiring temporary workers will be increases with 17% in 2016.Labour markets: Temporary employment include those people whose termination dateis already determined and they will perform as per the wage and salary. Due to changes in labourmarket, there will be changes in the number of temporary workers in UK. As per the research, ithas been found that in UK, if rate of labour market is increases with 15% than it will directlyimpact on the rate of temporary workers which also be increase with 13% in 2016.Demand and supply: Law of demand and supply shows the inverse relation with eachother. According to law of demand, if the price of goods is increases than quantity of relatedgood will decreases. In the case of temporary workers, if the number of workers rate is increases1
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