The phrase risk management is being used by various industries, that have formulated their own definitions. Look for a definition that clearly explains financial risk and give reasons why your chosen definition is the most appropriate.
The definition clearly states the fundamental of financial risk. Its the exposure of the investor, and the way debt is being funded. It also explains that financial risk is not limited to companies, but it also includes the decision of government and the reaction of the markets and what effect it has on the financial sector. Financial risk is the possibility that shareholders will lose money when they invest in a company that has debt if the company's cash flow proves inadequate to meet its financial obligations. When a company uses debt financing, its creditors are repaid before its shareholders if the company becomes insolvent. Financial risk also refers to the possibility of a corporation or government defaulting on its bonds, which would cause those bondholders to lose money. Read more: Financial Risk https://www.investopedia.com/terms/f/financialrisk.asp#ixzz58JOP1DvY Follow us: Investopedia on Facebook
Financial mathematics: You are saving up for a graduation holiday with your friends. You can save $75 per month and you are planning to graduate in 4 years time. You go to your local bank, where you open a savings account where you will be getting 5% per annum, compounded monthly. You would be making the payments at the end of each month. How much would you have saved up for your holiday at the end of the 4years? Make use of your calculator to work out the answer
Let's write out the numbers that we can take from the question. $75 that would be our monthly payment (PMT) Note that payments are done at the end of the month. 4 Years = 48 Months our term or (N) 5% Intrest. Careful with this one. It's compounded monthly. So we need to divide the compounding periods 5/12 Our aim is to compute the future value. (FV) Now we just need to key in the amounts 75 = PMT 4*12= N 5/12 = I/Y Comp FV = $3976.12
Question overview: There are approximately 5-6 main business functions. They include but not limited to. Operations, logistics, finance, human resource management, and marketing. Questions: A bank experience fraud from an outside source in their IT system. This caused unauthorized transactions on certain clients accounts. What areas of business functions of the business have been affected, and what action should be taken by the relevant departments? Discuss in your own view, which two departments have had the greatest impact.
Information technology department: This would be where most of the organization's resources would be applied to, seeing that this is where the root of the problem lay Marketing department: Us customer accounts have been implicated because of the fraud, the banks marketing department must be in contact with the customers, and communicate a suitable outcome.