Introduction to Data Driven FM and Python Flashcards
1
Q
Purpose and Use Cases of Financial Modeling
A
- Investment Decisions
- Financial Analysis
- Risk Management
- Budgeting and Forecasting
- Strategic Planning
2
Q
Key Components of a Financial Model:
A
- Inputs
- Processing
- Outputs
3
Q
Types of Financial Models
A
- DCF
- CCA ( Comparable Company Analysis)
- Budget Model
- Three Statement Model
- Option Pricing Model
- Mergers and Acquisitions
4
Q
Steps to Create a Financial Model:
A
- Define Purpose
- Gather Data
- Select the Appropriate Model
- Build the Model
- Test the model
- Iterate and Refine
- Draw conclusions
5
Q
Challenges in Financial Modeling
A
- Overfitting
- Garbage in garbage out
- Changing dynamics
- Complexity
