Difference between revisions of "Other economic tools"
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== Introduction == |
== Introduction == |
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| − | Apart from the commonly used economic impact studies, social cost-benefit analysis and business cases, there are other types of commonly carried out economic analyses, which are addressed below |
+ | Apart from the commonly used economic impact studies, social cost-benefit analysis and business cases, there are other types of commonly carried out economic analyses, which are briefly addressed below: |
===Demand analysis=== |
===Demand analysis=== |
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A '''demand analysis''' estimates or predicts the amount of some good (or service) that consumers are willing and able to purchase. For this, economists use sales estimations, forecasting or a demand model. a typical question that is answered in this type of study is: How will the number of users of an urban object (e.g, a road or an airport) change due to the changes in prices, promotion, reachability et cetera? |
A '''demand analysis''' estimates or predicts the amount of some good (or service) that consumers are willing and able to purchase. For this, economists use sales estimations, forecasting or a demand model. a typical question that is answered in this type of study is: How will the number of users of an urban object (e.g, a road or an airport) change due to the changes in prices, promotion, reachability et cetera? |
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===Financial analysis=== |
===Financial analysis=== |
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| + | A '''financial analysis''' assesses the viability of a business/activity, and aims to answer the question if it is possible to make profit from this activity? This kind of analysis is also referred to as a financial statement or accounting analysis. "It generally includes a short-term analysis of the availability and costs of start-up capital as well as a longer-range analysis of debt service, operating costs and revenues"<ref>Source: Stynes, D.J. (1999). ''Economic impacts of Tourism''.</ref>. |
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| − | A '''financial analysis''' |
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| − | Financial analysis (also referred to as financial statement analysis or accounting analysis or Analysis of finance) refers to an assessment of the viability, stability and profitability of a business, sub-business or project. |
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| − | It is performed by professionals who prepare reports using ratios that make use of information taken from financial statements and other reports. These reports are usually presented to top management as one of their bases in making business decisions. |
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| − | Continue or discontinue its main operation or part of its business; |
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| − | Make or purchase certain materials in the manufacture of its product; |
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| − | Acquire or rent/lease certain machineries and equipment in the production of its goods; |
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| − | Issue stocks or negotiate for a bank loan to increase its working capital; |
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| − | Make decisions regarding investing or lending capital; |
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| − | Other decisions that allow management to make an informed selection on various alternatives in the conduct of its business. |
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| + | ===Fiscal impact analysis=== |
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| + | Analogous to a financial analysis of private companies, a fiscal impact analysis "identifies changes in demands for government utilities and services resulting from some action and estimates the revenues and costs to local government to provide these services<ref>Burchell, R.W. and D. Listokin (1978). The fiscal impact handbook. New Brunswick, N.J. In Stynes, D.J. (1999). ''Economic impacts of Tourism''.</ref>. |
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Revision as of 15:10, 1 May 2012
Contents
Other economic tools
Introduction
Apart from the commonly used economic impact studies, social cost-benefit analysis and business cases, there are other types of commonly carried out economic analyses, which are briefly addressed below:
Demand analysis
A demand analysis estimates or predicts the amount of some good (or service) that consumers are willing and able to purchase. For this, economists use sales estimations, forecasting or a demand model. a typical question that is answered in this type of study is: How will the number of users of an urban object (e.g, a road or an airport) change due to the changes in prices, promotion, reachability et cetera?
Financial analysis
A financial analysis assesses the viability of a business/activity, and aims to answer the question if it is possible to make profit from this activity? This kind of analysis is also referred to as a financial statement or accounting analysis. "It generally includes a short-term analysis of the availability and costs of start-up capital as well as a longer-range analysis of debt service, operating costs and revenues"[1].
Fiscal impact analysis
Analogous to a financial analysis of private companies, a fiscal impact analysis "identifies changes in demands for government utilities and services resulting from some action and estimates the revenues and costs to local government to provide these services[2].
Environmental impact assessment
Feasibility study
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