Question

Given our inability to accurately “do the math” when we are making decisions about a future events with an uncertain outcome, please describe how people {like you and me} usually make those decisions? What implications may this “reality” have for the way financial markets actually function?

Answer 1

the inability of accurately “do the math ” in the decision making about a future events with an uncertain outcome, so in this case general people take the decisions in the matter of financial market functions are as follows:
1- The decision must be based on the future forecasting.
2- The decision must be on the basis of accuracy of the planning of the financial sources.
3- The decision is on the basis of past structured performance.
4- The decision decides the way of doing and handling the actual requirements which are on the way of functioning the project analysis.
5-General way of doing any thing is to analyse the things and observing the future events on the basis cost structure.
6-The return policies also suggested the actual funding.
7-The financial management involves the three decisions: which are as follows: a- investment decisions, financing decisions and dividend decisions.
8-The main objective of analysing the things are to maximise the shareholders wealth.
9-The capital budgeting decision is also an important factor in the analysis of the financial decision of the economy.
10-The option of short term finance is very important in the analysis of finance requirement fulfilment.