University of Arkansas ECON 101 PFP Chapter 18 Complete Q&A (2022/2023.)

1. What is financial integration? A. Using all assets and liabilities, all cash flows, all household activities, and all future plans to arrive at decisions. B. Including all current and future resources and information in decision making. C. Making one decision at a time based strictly on the merits of that item. D. Both a and b. E. Both b and c. 2. Which of the following is not a way through which to make integrated financial decisions? A. Total portfolio management. B. Capital needs risk management. C. Simple capital needs analysis. D. Capital needs analysis incorporating risk. E. All of the above are ways through which to make integrated financial decisions. 3. Why does capital needs analysis qualifies as a PFP integration approach? A.It takes into account all current and projected income and expenses and assets and liabilities over our life cycle. B. It takes into account projected income and expenses and assets and liabilities over our life cycle. C. It takes into account current income and expenses and assets and liabilities. D. It takes into account past income and expenses and assets and liabilities. E. None of the above. 4. Which of the following is a method that is commonly used to incorporate risk? A. Avoid risky capital needs projections. B. Use Monte Carlo simulation. C. Be more conservative in our simple capital needs projections. D. Both a and b. E. Both b and