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Financial Management
book

Financial Management

by Jack Alexander
January 2024
Intermediate to advanced content levelIntermediate to advanced
720 pages
17h 20m
English
Wiley
Content preview from Financial Management

4Developing Predictive and Analytical Models

WHAT IS A FINANCIAL MODEL?

A model is essentially a mathematical representation of a transaction, event, or business, and typically involves the use of assumptions and relationships of various factors to predict an outcome. Most models rely heavily on historical results and past experience to project future outcomes.

A financial model allows us to project and test the dynamics of a business, project, or program. Developing an effective model of a business or significant project requires a sophisticated understanding of the business or opportunity at hand. The analyst will almost always need input from other business disciplines such as sales and marketing, operations, and research and development.

Several challenges arise in developing effective models. The first challenge is to create a model that will fully satisfy its primary objective. Second, almost all models include ...

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Publisher Resources

ISBN: 9781394228362Purchase Link