Week 10 Question 2 Part 2 Looking Ahead - Assignment Example

LOOKING AHEAD (QUESTION TWO) al Affiliation) In this lesson, I have been able to acquire vast knowledge that will enable me make a good decision in my current position as a finance person. These decisions especially relate to investment decisions made by the government. Knowledge on cost of capital proved to be most valuable in this course. This is because for any country to have a successful economy, it needs to ensure that the economy can be able to support public investments (Dickerson, 1994).

This is by ensuring that the financing method of an investment does not affect the economy negatively. When investing in the public, the government needs to ensure that financing methods used does not increase the country’s debt. If debt financing cannot be avoided, the government needs to ensure that the economy can be able to support the repayment of the debt. This knowledge will help me give wise and informed advice on any investment decision taken. The knowledge acquired in this course on budgeting also proves to be viable in my position.

I plan to apply the skills from this topic in ensuring that the decision on expenditure helps my office meet its targets. The government normally allocates a certain amount of funds to its branches in a financial year. This course has helped me to appreciate how crucial it is to have budgets in order to ensure that all targets are met. Budgets work by apportioning money according to projects or activities, and the periods under which they need to be completed. This helps in avoiding overspending and also helps in finishing projects in time (Pratt, 2002).

An individual who has no financial background could use what is learned in finance in making better decisions. For example, looking at risks and the assessment of risks, this individual can be able to determine how risky it is to invest in a company by looking at the general view of the company (Chong, 2004). This may by looking at cases of corporate mismanagement in the company that indicate high risk. This individual can also be able to know the performance of a company by looking at the performance of the company or by relying on investors’ reactions.

For example, a company that is not performing well will have reports that show poor performance. Investors will also react by shying away from investing in the company. ReferencesDickerson, B, et al. (1994). Introduction to financial management. Fort Worth: Dryden Press.Pratt, S. (2002). Cost of Capital: Estimation and Applications. Hoboken, NJ: John Wiley & Sons.Chong, Y. (2004). Investment Risk Management. Chichester: John Wiley & Sons.