Question

identifying the role you are playing

Investment Decisions for Big Spenders Inc.

Background

You are an Analyst for the professional service firm, BUSI 1043 LLP. Your firm specializes in providing a wide variety of internal business solutions for different clients. It is your first day on the job and a Manager in the Consulting area asks you for some help with an investment decision for one of your large clients, Big Spenders Inc. Ready to make an impression on your first day, you start reading the background information provided by the Manager

Answer 1

Primary function of the analyst role is a efficient allocation of capital Which involves decision to commit the firm’s fund to the long term assets .such decision are of considerable importance to the firm since they to determine its value size by influencing its growth profitability and risks. Investment decision of the firm generally known as capital budgeting ,capital expenditure decisions. Capital budgeting decisions means to invest the current funds most efficiently in the long term assets in anticipation of an expected cash flow if benefits over s series of the years .usually firm investment decision includes expansion, acquisition ,modernisation and replacement of the long term assets ,sale of a division or business ,activities such as change in sale of distribution ,advertisement campaign and research and development programme have long term implication for the firm expenditure and benefits and therefore they may also be evaluated as investment decision.

Based on the information provided by the client analyst has to study all the options which are available keeping in view of the investment decision and chose the best alternative option to client in order to minimize the cost and maximise the return