Which of the Following Is NOT One of the Steps

question 30

Multiple Choice

Which of the following is NOT one of the steps taken in the financial planning process?

• A) Monitor operations after implementing the plan to spot any deviations and then take corrective actions.
• B) Determine the amount of capital that will be needed to support the plan.
• C) Develop a set of forecasted financial statements under alternative versions of the operating plan in order to analyze the effects of different operating procedures on projected profits and financial ratios.
• D) Consult with key competitors about the optimal set of prices to charge, i.e., the prices that will maximize profits for our firm and its competitors.
• E) Forecast the funds that will be generated internally.If internal funds are insufficient to cover the required new investment, then identify sources from which the required external capital can be raised.

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Definitions:

Nonlabor Income

Income received from sources other than employment or the active exertion of effort, such as dividends, interest, or rental income.

Leisure

Time free from work or duties, which can be used for rest, recreation, or other personal activities.

Parallel Fashion

A manner in which activities or processes occur simultaneously or in a coordinated manner, often leading to increased efficiency or synchronization.

Slutsky Equation

A formula that decomposes the effect of a price change into a substitution effect and an income effect on the consumption of goods.