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Applying Business Concepts and Tools For Finance and Investment Problems

This document provides information about personal finance, investments, and entrepreneurship. It discusses the steps to creating a budget, including calculating expenses, determining income, setting savings goals, and tracking spending. It also outlines considerations for personal investments like age, gender, family status, income source, and objectives. Specific investment types are explored, such as stocks, real estate, and entrepreneurship. Stocks represent ownership in a company, while real estate includes residential, commercial, and industrial property. The document defines an entrepreneur as someone who founds and runs a small business and lists traits like risk-taking, skills, creativity, and persistence.

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John Fort Edwin Amora
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189 views

Applying Business Concepts and Tools For Finance and Investment Problems

This document provides information about personal finance, investments, and entrepreneurship. It discusses the steps to creating a budget, including calculating expenses, determining income, setting savings goals, and tracking spending. It also outlines considerations for personal investments like age, gender, family status, income source, and objectives. Specific investment types are explored, such as stocks, real estate, and entrepreneurship. Stocks represent ownership in a company, while real estate includes residential, commercial, and industrial property. The document defines an entrepreneur as someone who founds and runs a small business and lists traits like risk-taking, skills, creativity, and persistence.

Uploaded by

John Fort Edwin Amora
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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ddaWoodridge College

Soldiers’ Hills IV, Molino 6 Bacoor, Cavite

Applying Business Concepts and Tools for


Finance and Investment
Problems

Business Finance
ABM 6

Reported by: John Fort Edwin E. Amora


Grade 12 ABM

Submitted to: Prof. Lester Concepcion

First Semester
SY 2018-2019
One of the most effective ways to understand the basic concepts of finance is through
personal finance. How does one source his funding, create a budget, monitor the budget, and
control his costs, to ultimately maximize his revenues and reduce his expenses.

Planning a Budget
There are steps in planning a budget and here’s the following steps:
Steps in Planning a Budget:
1. CALCULATE EXPENSES
2. DETERMINE YOUR INCOME
3. SET SAVINGS AND DEBT PAYOFF GOALS
4. RECORD SPENDING AND TRACK PROGRESS
5. BE REALISTIC
Since budgeting allows you to create a spending plan for your money, it ensures that you will
always have enough money for the things you need and the things that are important to you.
Following a budget or spending plan will also keep you out of debt or help you work your way
out of debt if you are currently in debt.

Personal Investments
The process is a must preparation without which the investment portfolio will likely fail to
achieve the objectives. A financial investment by a person, rather than by a business or a
financial institution, or these investments considered as a whole. One would have to know the
certain information as to not look inappropriate.
Example Questions:
1. What is the occasion?
2. What will be the weather?
3. How long will be the event?
4. Who will be hosting?
Age of the Investor
Age plays a crucial role on their behavioral biases and success of their investment decisions.
How investors’ age determines their investment behavior is studied in this paper. Age has
significant influence of determining their investment behavior.
• It is one of the factors in taking risks for investments.
• 20-30s: Can afford to take more risks
• 30-40s: Had to temper risks for he/she will require monthly requirements
• 40-60s: becomes conservatives and averse in risk taking
• 60s and above: keeps fixed income because of age

Other Considerations
• Gender
• Civil Status
• Number of kids
• Source of Income
• Objective for investing

Stocks
A stock is a type of security that signifies ownership in a corporation and represents a
claim on part of the corporation's assets and earnings. There are two main types of stock:
common and preferred. Common stock usually entitles the owner to vote at shareholders'
meetings and to receive dividends. Preferred stockholders generally do not have voting rights,
though they have a higher claim on assets and earnings than the common stockholders. For
example, owners of preferred stock receive dividends before common shareholders and have
priority in the event that a company goes bankrupt and is liquidated.
Real Estate
Real estate is property made up of land and the buildings on it, as well as the natural
resources of the land, including uncultivated flora and fauna, farmed crops and livestock, water
and mineral deposits. Although media often refers to the "real estate market," from the
perspective of residential living, real estate can be grouped into three broad categories based on
its use: residential, commercial and industrial. Examples of residential real estate include
undeveloped land, houses, condominiums and town houses; examples of commercial real estate
are office buildings, warehouses and retail store buildings; and examples of industrial real estate
include factories, mines and farms.
Advantages:
• Hedge against Inflation
• Rent Income
• Real and tangible properties
Disadvantages:
• Illiquid Investments
• They may also experience some decline
• Lack of Diversification
• All issues are to come with real estate investments

The Entrepreneur
An entrepreneur is an individual who, rather than working as an employee, founds and
runs a small business, assuming all the risks and rewards of the venture. The entrepreneur is
commonly seen as an innovator, a source of new ideas, goods, services and business/or
procedures.
Traits of an Entrepreneur:
• Willingness to take action
• Entrepreneurial knowledge
• Entrepreneurial creativity
• Entrepreneurial skills
• Entrepreneurial intelligence
• Patience
• Persistence
• The ability for teamwork
• Risk taking, but calculated risk
• The self-confidence as a key success factor
• To have enough experience
• Great talent
• Honesty
• Connections
• Luck
References:
Yumang, K.L. . et. al(2016) Exploring Small Business and Personal Finance. Quezon City,
Philippines: The Phoenix Publishing House
Elmerraji, J. (n.d.). How to Invest in Stocks - Stock Investing 101. Retrieved from
https://www.thestreet.com/topic/47701/how-to-invest-in-stocks.html
Sutevski, D. S. (2018, March 22). 15 Entrepreneurial Key Success Factors To Skyrocket Your
Business. Retrieved from https://www.entrepreneurshipinabox.com/852/entrepreneurial-success-
factors/

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