Financial Planning discussion questions Here is the questions list that you are going to answer. Ch 4 Questions: 1,3,5,8,9,10,13,14,18,19 d enterprise, 8

Financial Planning discussion questions Here is the questions list that you are going to answer. Ch 4 Questions: 1,3,5,8,9,10,13,14,18,19 d enterprise, 87
opportunity cost of time, 86
Questions
1. Define the household in financial terms.
2. What makes the household the financial structure for the individual?
3. List some of the advantages and disadvantages of various organizational structures for
the individual.
4. How do people choose their goods?
5. How are spending decisions made according to the life cycle theory of savings?
86. What does life cycle theory say a household should have in savings at the end of its
life? Is that practical? Explain your answer.
7. Define the term opportunity cost of time.
8. The cost of time is a noncash charge, so why is it important?
9. What makes the household an enterprise?
10. How do finance and economics differ in emphasis?
11. Describe household operations according to household finance.
12. Why is it important to differentiate among the various types of household expendi-
tures?
V3. Outline the similarities and differences between a household and a business.
14. What is the importance of the theory of financial planning?
15. Are any of the outlays in Table 4.1 preferable to the others? Support your answer.
16. When would it be beneficial for the household enterprise to outsource some activities,
for example, cooking?
17. If operating efficiently is the main goal of a household enterprise, are there any draw-
backs?
18. What is TPM and why is it valuable in the framework of household planning?
19. What is to be gained by incorporating both theory and practical tools, such as oppor-
tunity cost of time, into household planning?

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