2.2 Quiz: Overview of Finance

Question 2 of 10

What term refers to an educated prediction of what the financial situation is likely to be in the relatively near future?

A. Budget
B. Forecast
C. Risk analysis
D. Report



Answer :

Final answer:

Forecasting in finance involves making educated predictions about future financial situations based on data analysis and trend evaluation.


Explanation:

Forecast refers to an educated prediction of what the financial situation is likely to be in the relatively near future. It involves analyzing past data, current trends, and future events to make informed projections.

Revenue forecasting is an essential part of financial planning and budgeting, where revenue officials track economic trends and project revenues for the fiscal year to create budgeted revenues.

This process helps organizations make strategic decisions and allocate resources effectively based on anticipated financial outcomes.


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