Sumit Ambekar

152190001

Q1)

—>

The two distinct elds of economics that research the economy in di erent
ways are microeconomics and macroeconomics.

Macro Economics -

Macro targets the large-scale or general economic issues and how they
interact in economies. It is the study of complete economies.

Macrostudies trends in the economy as a whole, including in ation, price

changes, economic growth, NI, GDP, and changes in unemployment.

Its top down approach

Micro Economics -

micro examines how people, households, and businesses behave while

making decisions about the economy. All forms of business are collectively
referred to as " rms"

An extensive portion of the subject of micro is given over to examining how

markets set pricing. Any mechanism that connects producers and
consumers is a market. Also the market structure needs to be understood
whether it is in oligopoly market or monopoly or in monopolistic market. This
helps in determining the pricing of a product .

fi
fi
fl
ff
The phrase "business environment" refers to the complete circle of all
people, groups, organisations that compete with one another, as well as the
government, courts, media, nanciers, and other elements that fall outside
the jurisdiction of business organisations yet have an impact on how well
businesses runs. Therefore, although they are outside of the control of
business organisations, changes within government economic policies, rapid
advances in technology, shifts in consumer tastes, growing market
competition, etc. have a signi cant impact on corporate performance.

Components of Environment -

Internal -

HR

Labor Union

Value System

Vision and Mission

Corporate Culture

External -

Macro - This category includes political, legal, sociocultural and

international aspects.

Micro: A business is directly and immediately impacted by this

Clients, suppliers, environment etc. make up this group.

Q2)

—>

Most important functions -

NPV (Net Present Value): Using NPV, future cash ows are discounted at a
predetermined rate of return to determine their PV. It aids in determining if an
investment or project will be pro table.

=NPV(discount rate, series of cash ow)

IRR(Internal Rate of Return):The rate of return at which the net PV of CF

drops to zero is calculated using the internal rate of return, or IRR. It is
frequently used to evaluate a project's viability or to compare various
investment prospects.

=IRR(values,[guess])
fi
fi
fi
fl
fl
 PMT (Payment): PMT determines how often a loan or annuity will be repaid.
It is helpful for guring out the xed amount of payments necessary to pay
o the debt or estimating the value of future recurring deposits.

=PMT(rate, nper, pv, [fv], [type])

RATE: RATE determines the period interest rate for a loan or investment. To
compute the cost of borrowing or gure out the interest rate necessary to
obtain a given future value, it is frequently used in nancial modelling.

=RATE(nper, pmt, pv,[fv], [type], [guess])

PV (Present Value): Using a predetermined discount rate, PV determines the

current value of an investment or cash ow. It aids in guring out the current
value of potential future cash ows or calculating an investment's worth.

=PV(rate, nper, pmt, [fv], [type])

FV (Future Value): Using a predetermined interest rate, FV determines the

potential value of an investment or the ow of cash. It aids in calculating the
long-term value of a stake or the future value of savings.

=FV(rate, nper, pmt, [pv], [type])

The NPER (Number of Periods) formula determines how many periods are
necessary to reach a given future value or for paying o a loan. It is used to
calculate the length of a loan or investment.

They help with project feasibility assessments, cash ow analyses,

investment evaluations, and nancial decisions based on various nancial
criteria.

Q3)

—>

The database function are speci cally made for database or list of data

DSUM - sum of values that meets speci c criteria

DAVERAGE - calculates average of speci c values

DCOUNT - Count the no. of speci c data that is required

DMAX - in a list, the max number that is there in it is calculated but of

speci c criteria

DMIN - in a list, the min number that is there in it is calculated but of speci c
criteria

ff
fi
fi
fi
fl
fi
fi
fi
fi
fl
fl
fi
fi
fi
fl
fi
ff
fi
fi
 DPRODUCT - it calculates the product of speci c values that meet required
criteria

Regular functions and database functions in Excel di er primarily in their use

and intended outcome. Regular Excel functions are made to work with a set
of data or a range of cells within a worksheet. In a single worksheet, they are
often utilised for data manipulation, general calculations, and mathematical
procedures. When working with huge amounts of information, such as
nancial information, inventory records, or client database functions are
especially helpful. Without using complicated algorithms or manual ltering,
they o er an easy approach to acquire and change data based on particular
criteria. Regular Excel functions are ideal for general computations and data
editing within a single worksheet, but database functions provide a more
specialised and e ective method for working with big data sets.

Q4)

—>

The topic I found most interesting in Financial Modelling is Forecasting

The reason ->

1 -> The reason is very interesting, forecasting is not simple there needs to
be deep understanding about the market situation, thinking about raw
materials, thinking about about geopolitics there is too much uncertainty and
forecasting is done based on certain things, there requires a thorough
understanding about various discipline

2 -> The other reason is quantifying the demand, how it will change whether
it is seasonal or not and making a decision based on consumer insight is
very interesting, I made a nancial model of aegis logistics, thinking about it I
failed thoroughly thus making it interesting for me. Understanding the market
competition its interesting.

3 -> Risk Management, very interesting understanding and taking into

consideration of risks, economic downturn, problem with environmental
issues its very interesting quantifying the cushion so that risk could be
mitigated, assessing synergies, valuing target companies, and evaluating the
nancial implications of the transaction.

4 -> Allocation of resources is another thing I nd interesting, the best thing

is knowing enough to make correct decision and the truth is there is no
correct decision whether to allocate resources for inventory, HR, knowing
what will be the best option but it comes with a cost.

fi
fi
ff
ff
fi
fi
fi
ff
fi
5 -> The best thing about forecasting is its never perfect continuous
evaluation and there requires no skill or expertise, its a craft that can be
mastered by continuously doing

Least interesting thing I nd is Sensitivity analysis

1 -> Just changing the variables

2 -> in simulation as well looking at what can a ect the model needs to be
taken care of, but also the important tells us how to manage risk involved

3 -> Other thing is determining capital structure, just a one time thing
knowing the debt taken will let the person know how the structure is

These are all the things I know, looking to learn more

fi
ff